NEW DELHI: Amid apprehensions of a fall in Chinese language funding in India, total flows added as much as simply $163 million in 2019-20 and no proposal has been filed for the reason that authorities determined final April to scan all international direct investments (FDIs) from international locations with which India shares a border.
“We now have ourselves determined to maintain shut tabs on Chinese language funding, which was meant to discourage them, particularly due to the takeover risk for our firms. With out our permission, they can not make investments a single yuan in India,” a authorities supply mentioned.
Officers mentioned some buyers could also be eager to keep away from scrutiny and could also be ready for the detailed clarifications to emerge, which can specify issues just like the definition of “vital useful possession”. The brand new guidelines on FDI for neighbouring international locations, put in place with an eye fixed on Beijing, have been meant to make sure that Chinese language buyers don’t enter India through a 3rd nation.
Whereas state-backed Chinese language media urged that FDI inflows will decelerate as a result of Covid-19 in addition to the border skirmishes, authorities officers have been, nonetheless, dismissive, arguing that China accounts for 0.5% of FDI inflows into India.
Official information confirmed that China was at quantity 18 by way of supply of FDI with a number of different international locations reminiscent of Singapore and Mauritius forward of it.
Numerous Chinese language buyers, reminiscent of electronics items maker Xiaomi, have entered India through Singapore and different international locations, which don’t replicate within the official numbers. A report by thinktank Gateway Home estimated Chinese language FDI at round $6.2 billion, with funding in Indian tech firms at round $4 billion. Even at this stage, will probably be decrease than Singapore, Mauritius, US, UK, Germany, Netherlands and Japan, amongst others.
The official numbers recommend that of the $2.4 billion FDI from China within the final 20 years, near $1 billion has gone into the auto sector.
