India plans to fast track Chinese investments after policy change: Report
- 2020-04-26 02:12
- By indiatoday.in
To avoid opportunistic takeovers during the coronavirus outbreak, India said this week that all foreign direct investment from countries sharing a land border would require prior government clearance. To avoid opportunistic takeovers during the coronavirus outbreak, India said this week that all foreign direct investment from countries sharing a land border would require prior government clearance, meaning they can’t go through a so-called automatic route. Auto firms such as SAIC’s MG Motor and Great Wall, and investors Alibaba and Tencent have placed major bets on India. A senior Indian government source who is involved in policymaking told Reuters that New Delhi will try to approve any investment proposal in a non-sensitive sector within 15 days when the stake being bought is not significant. Two other sources familiar with the government’s thinking confirmed that a fast track mechanism was being considered, with possible approval timelines of seven days to four weeks. While the fast track mechanism would be open to all India’s neighbours with a land border, China would be the main beneficiary. Unlike Pakistan, Bangladesh, Myanmar, Nepal and Bhutan, it has major existing and planned investments in India, which the Brookings research group estimated at $26 billion. Dipti Lavya Swain, a partner at Indian law firm HSA Advocates which advises Chinese companies, said sectors such as telecoms, financial services and insurance were likely to be deemed more sensitive than others such as automobiles and renewable energy. Responding to Reuters questions this week, China’s foreign ministry said it hoped for a better business environment as India had set up more barriers for some investors. In the face of the economic downturn caused by the epidemic, countries should unite to overcome difficulties,” it said in a statement dated April 22.