Investments by Chinese companies in India may start again. According to reports, the Indian government has changed its stance on investment proposals coming from China after a gap of years. The government has recently approved some proposals.
News of approval of 5-6 proposals of China
An ET report has claimed, citing people familiar with the matter, that the government has recently approved some Chinese investment proposals. This approval is for the electronics manufacturing sector. The inter-ministerial panel has approved 5-6 such proposals. If this claim is true, then after a gap of years, China’s investment proposal has been approved by the Indian government.
Change in attitude after 4 years
About 4 years ago, relations between India and China soured when there was a violent clash between the armies of the two countries in the Galwan Valley. After that, the Indian government took a tough stand on Chinese companies. Scrutiny of existing Chinese companies was increased, while new investment proposals were put on hold.
For the first time, there are signs of relaxation in the tough stance adopted by the Indian government after the clash in Galwan Valley in June 2020.
These major proposals got the green signal
According to the report, the investment proposals approved by the government include that of Chinese electronics manufacturer Luxshare. Luxshare also works as a vendor for Apple. Apart from that, there is a proposal to form a joint venture between Micromax’s parent company Bhagwati Products and Chinese company Huaqin Technologies. The Chinese company will have a minority stake in the JV.
There was pressure from the electronics manufacturing industry
Among the other proposals approved by the Indian government, some are from Taiwan-based companies, which are either listed on the Hong Kong stock exchange or have significant investments there. Some proposals are entirely from Chinese companies. It is being said that the government was under pressure from the electronics manufacturing industry to approve some proposals from China so that the supply chain in India could be strengthened.
Also read: Indian government is preparing to relax Chinese investment in some sectors!
