After the revision of the Foreign Direct Investment Policy, the government is looking to consider up to 26% FDI from countries that share a land border, including China.
This decision will accelerate more than 100 pending proposals that are stuck in the pipeline after the FDI policy was amended in April. Moreover, an inter-ministerial panel of secretaries is discussing various options, and a decision is expected soon.
The government vested in a screening panel to scrutinize all Chinese foreign investment proposal and was aimed to approve only ‘non-controversial’ proposal. The panel is made of people who suggested the government to ease rules.
A government official said, “Suggestions are that up to 26% should be allowed for some sectors.”
After the revision of FDI rules, the Alibaba Group decided to re-evaluate its investment portfolio in India. This came after the government amended the foreign direct investment (FDI) rules for countries that share a land border with India.
The wave of anti-China sentiment in the country and the pending proposal awaiting clearance from the US and European companies have marginal investment from Honk Kong or China-based entities or individuals.