INDIA PUTS 175 FDI PROPOSALS ON HOLD FROM CHINA
                     INDIA PUTS 175 FDI 
PROPOSALS ON HOLD 
FROM CHINA
INTRODUCTION
• All FDI (foreign direct investment) proposals from Chinese entities 
have been put on hold as they await security clearance from the 
Ministry of Home Affairs
Source: Business Today
OBJECTIVE
• The objective of the national security clearance is to evaluate 
potential threats, visible or embedded, in proposals received by the 
home ministry and to provide a national risk assessment.
Source: Business Today
PENDING FOR APPROVAL
• As many as 175 FDI proposals, including investments from China’s 
Great Wall Motors (GWM), petrochemical major Hengli and Foton 
China, are pending for approvals.
Source: Business Today
REVISED FDI POLICY
• Centre had revised its FDI policy for those countries that share their 
borders with India. 
• As per the tweak, neighbouring nations can invest in Indian firms 
only after getting the Centre's approval for the same. 
Source: Views Today News
 NEW POLICY
• An entity of a country that shares land border with India or where 
the beneficial owner of an investment into India is situated in or is a 
citizen of any such country can invest only under the government 
route.
Source: Business Today
APPLICATION OF NEW 
POLICY
• The new rules will apply to
–  The transfer of ownership of any existing or future FDI in an entity in 
India, directly or indirectly.
– The Department for Promotion of Industry and Internal Trade (DPIIT) 
states. 
Source: taxscan.in
COVID-19 PANDEMIC
• The amendment in FDI rules issued in April this year further seeks to curb 
opportunistic takeovers or acquisitions of Indian companies due to the 
Covid-19 pandemic.
Source: Computer World
  FDI PERMITTED ROUTES
• In India, FDI is permitted under two routes: 
– The first, via the automatic mode where the companies do not need an 
approval from the state .
– The second, through the government route, for which companies need 
clearance from the Centre.
Source: HW English
  GREAT WALL MOTORS
• Great Wall Motors, China’s largest maker of SUVs, acquired General 
Motors’ Talegaon factory in January for Rs 950 crore as part of a $1-billion 
investment plan to participate in India’s fast-growing SUV market. 
• The automobile sector is on the automatic approval route, but any FDI from 
China needs government clearance.
Source: The Indian Express
  GOVERNMENT APPROVAL 
• 17 sectors, including defence, telecom and pharmaceuticals, need 
government approval if any company from abroad wants to invest 10% or 
more. 
• Inputs from financial intelligence units are taken into consideration in sectors 
which require government approvals.
Source: The Logical  Indian