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Strict vetting of proposals from neighbours: Home Ministry

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NEW DELHI: As the Union commerce and industry ministry announced its new foreign direct investment (FDI) policy for neighbouring countries, home ministry officials said there will be “strict vetting” of proposals from these countries, particularly from China and Hong Kong.

In the past five years, MHA has given security clearances to more than 6,000 investment proposals, including FDI, most of which were from China, Hong Kong, the United Kingdom and Singapore.

In may be noted that in 2015, New Delhi had eased visa restrictions for Chinese nationals and allowed an investor friendly policy on FDI, under which FDI up to 100% was permitted under the automatic route in most sectors like telecom, construction development, broadcasting, civil aviation, pharmaceuticals, trading. The current amendment in the FDI rule seeks to curb “opportunistic takeovers or acquisitions of Indian companies due to the Covid-19 pandemic”, the commerce ministry said on Saturday.

This may further lead to China and its nationals being brought under the Prior Referral Category category on par with countries like Pakistan, Iraq, Sudan, North Korea and Iran among others, officials told ET.


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