India allays fears on new FDI rules; says it doesn’t prohibit investment from bordering nations

TNN | Updated: Apr 24, 2020, 08:11 IST

(Representative image)

NEW DELHI: Days after tweaking FDI rules, India on Thursday said no country should be worried about the new regulations. China has strongly objected to the change in rules, which makes it mandatory for countries sharing land boundary with India to invest through the government route.
The new rule, as has been reported earlier, is meant to prevent "opportunistic takeovers" of domestic firms in the wake of economic downturn triggered by the Covid-19 pandemic.
Government sources said there shouldn't be concern over procedural changes made in the FDI policy, asserting that it doesn't prohibit investment from any country with which India shares its border.

Walling off China: India changes FDI policy to block threat of takeovers

They said India's decision should be seen in the context that many other countries have taken similar steps to protect their economies in view of the coronavirus pandemic.
On the issue of FDI policy, China said India's new norms violated WTO’s principle of non-discrimination and are against the general trend of free trade.
The impact of the policy was clear on Chinese investors, a Chinese embassy spokesperson said earlier this week.
Chinese embassy spokesperson Ji Rong said China hoped that India would revise the "relevant discriminatory practices" and treat investments from different countries equally while fostering an "open, fair and equitable" business environment.