India may put on hold FDI proposals of 6 Chinese firms
Published On: Monday, June 22, 2020 | By: Team KnowMyStock
The Union home ministry is likely to stall security clearance to a clutch of Chinese companies seeking to invest in India, according to officials close to the development. Recently, India tightened the FDI policy for neighboring nations, with a focus on China. This also applies to transactions where the beneficial owner of the investment is from China. The amendments were made to curb opportunistic takeovers or acquisitions of Indian companies due to Covid-19. The Ministry of Home Affairs (MHA) received more than 20 proposals for foreign direct investment (FDI), including from China and Hong Kong, requiring security clearance between April and May. “We are vetting some of these proposals which have come from various sectors. One of the applications is from a well-known start-up,” an official said.
Six proposals for close to Rs 1,000 crore are under strict scrutiny, he said. “We await the inputs from the Research and Analysis Wing, intelligence agencies, external affairs ministry, and embassies,” he pointed out, at a time when Chinese investments are under scrutiny across sectors, following the border face-off. The proposals are from sectors like information technology, internet business, and infrastructure, among others. The list also includes trading- and logistics-related projects.
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