So while I assume they're tracking users, I don't think the calculator having a privacy policy is as shocking as it initially sounds.
You are saying that if you can find a single example of X happening in domain A and a single example of X happening in domain B, then "apparently" A and B must be "no different" with respect to X. People are murdered in Japan. People are murdered in Brazil. Thus Japan is no different than Brazil with respect to murders.
Please please tell me that you are just being inflammatory and that this "find one example" criteria isn't how you go about making assessments of things.
Could China possibly have infiltrated as much of global communications networks as the NSA & Five Eyes have for the past decade and a half? Not likely! If we didn't have such successful digital espionage programs, would we instead rely on our corporations to spy on our behalf? Very likely, seeing as we've already done that too.
It's more that consumers around the world have been brainwashed into believing huge markups are the default and must be accepted.
That of course does not alleviate the data collection concerns about Xiaomi, but it is unfair to say that given the production apparatus to produce at scale and the ability to absorb losses initially, it is not possible to make devices this cheap.
It would be very interesting to see a random sampling of 20 'non technical' users presented with such a phone, and given instructions simply "here is your new phone, please unbox it and connect it to the wifi and do things on the internet for three hours". Record a video of their interactions with the screen.
In my experience the vast, overwhelming majority of people when presented with a software popup like "Do you accept the license agreement to use this calculator?" will simply click yes/accept/okay/proceed as quickly as possible and disregard what it actually means.
I have a theory that a very small percentage of persons would actually balk or become suspicious of seeing something like a privacy policy agreement for a photo gallery or music player.
Generally, if you interrupt the user's flow of thought (if that's a thing) with something unrelated, they'll do the easiest thing possible to rid themselves of that annoyance, like a modal alert you threw at them, to get back on track doing whatever they intended to do. That's what all those consent popups are about. And that's why dark patterns work more often than not.
I roughly categorize UI/UX patterns into those that respect the user and those that don't. Showing a modal and making them decide something right now and right there is very disrespectful and off-putting. iOS of all things does this for system updates, low battery, and some urgent as hell alerts about your Apple ID. What you should be doing instead is use something non-blocking that can be ignored, like a notification, an icon badge, or a clickable bar at the top of the screen. Anyway, I digress.
And then, if you need a calculator, but the one that came with your phone quits unless accept the terms of use, what are you gonna do, as a non-technical person? Go to Google Play and look for a better one? Probably not.
I think most users even accept this as general setup things. When I, as a developer, want my device set up as quickly as possible, I mostly just proceed with everything.
The Xiaomi phone is better and more attractive in any other way, except privacy.