What’s the story
A high-level committee led by Rajiv Gauba, a member of NITI Aayog, has recommended the Indian government to either lift or gradually ease the existing restrictions on Chinese investments.
The recommendation was made in an internal report submitted in October, according to Business Standard.
The committee has suggested that the Department for Promotion of Industry and Internal Trade (DPIIT) should consider various options and take a final call by December 31.
Benefits of increased Chinese investment
The committee’s report emphasizes that increased Chinese investment could help India integrate into global value chains and boost export potential.
This recommendation could change India’s policy on investments from China.
The committee has proposed two options for easing the restrictions: one is to withdraw “Press Note 3,” which currently limits foreign direct investment (FDI) from countries sharing a land border with India, including China.
Second option involves threshold on beneficial ownership
The second option is to allow investments where the beneficial ownership is below a certain threshold. This recommendation has not yet been officially commented on by NITI Aayog. The report highlights potential benefits of increased Chinese investment, which could align with broader economic interests.