Chinese Investment In India: Over 380 FDI Applications Received, 80 Proposals Get Govt Nod

The Central government has received 382 foreign direct investment (FDI) proposals from Chinese entities since India imposed restrictions on investments by China-based firms in the country.

Further, as many as 80 FDI proposals from the Chinese entities have been approved by the government as on 29 June, according to data accessed from Department for Promotion of Industry and Internal Trade (DPIIT) through Right to Information (RTI).

However, it is unclear as to how many proposals were rejected by the government.

Earlier in 2020, after 20 Indian soldiers laid down their lives during a border skirmish with Chinese PLA troops, the Centre made a prior government approval, including a security clearance, mandatory for any FDI coming from countries sharing land borders with India.

The government reportedly did not approve any approvals for such FDI till mid-2021. However, since then, it had started considering the applications on a case-to-case basis, reports Economic Times.

The government has been adopting a cautious approach in evaluation of such proposals due to which approvals are slower.

Further, deals involving acquisition of minority stakes, thus not resulting in change of control, are generally getting government's approval.

Capital-intensive sectors, such as manufacturing, are getting preference over the sought-after sectors for FDI such as e-commerce and financial services, ET reported.

The government is also going slow on the investment proposals involving entities close to Chinese Communist Party.

While the Chinese proposals are now being cleared, even though in a cautious manner, the government has also brought out a slew of measures last month to check Beijing's influence in the corporate sector.