Can the government relax the rules regarding FDI coming from China?

If the investor belongs to the countries adjoining the Indian border and his ownership is less than 10 percent, then that proposal of investment will not need to be approved.

The proposal for investment coming from the bordering countries will be first scrutinized and then it is approved.

FDI from China: The government is preparing for changes in the FDI policy to accelerate investment during the Corona period. Recently, the Government of India had changed the rules of FDI especially keeping in mind the investment coming from China. At present, if a company or investor belongs to the countries bordering India, then the investment coming from there is more strictly scrutinized. The proposal for investment coming from the bordering countries will be first scrutinized and then it is approved. Now the government is thinking of making some changes in the rules. According to the Bloomberg report, if the investor belongs to the countries bordering the Indian border and his ownership is less than 10 percent, then that investment proposal will not need to be approved.

In other words, if there is an investor from the border countries and his stake in that company is less than 10 percent, then there will be no problem. It has been said in the report that foreign investment of about $ 6 billion is stalled due to the current rule. It is believed that the change in the rule will be approved by February. If this happens, an investment of $ 6 billion will happen immediately.

This decision was taken to prevent opportunistic takeover

Taking advantage of the opportunity, China started investing extensively in the Indian market. In such a situation, with the aim of preventing opportunistic takeover of China, the government had changed the FDI policy. After which the proposal for investment coming from China, Hong Kong gradually started getting approval. Dozens of investment proposals are still pending for scrutiny.

More than 100 pending proposals

According to the report, by November 2021, 100 investment proposals coming from border countries including China are awaiting approval. More than a quarter of these proposals are such, in which the value of investment is more than 10 million dollars i.e. 70 crores. It is believed that after the relaxation of the rule, there will be a flood of investors in India and investment will be done on a large scale. Queries sent to the Ministry of Trade and Industry on this issue are yet to be answered.

There is a steady rise in foreign investment

According to the report of the Ministry of Commerce, a total of $ 82 billion foreign investment (FDI) came in the financial year 2020-21. During the Modi regime, a total of $ 440-27 billion has come in FDI between the financial years 2014-15 to 2020-21. During the April-July period of the current financial year, FDI inflows into the country increased by 62 per cent to $27 billion.

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