{"id":8237,"date":"2020-04-18T14:42:13","date_gmt":"2020-04-18T14:42:13","guid":{"rendered":"https:\/\/sunkrish.com\/?p=8237"},"modified":"2022-06-04T11:33:35","modified_gmt":"2022-06-04T11:33:35","slug":"govt-approval-must-for-all-fdis-from-neighboring-countries-including-china-in-same-lines-as-made-by-several-countries","status":"publish","type":"post","link":"https:\/\/sunkrish.com\/index.php\/2020\/04\/18\/govt-approval-must-for-all-fdis-from-neighboring-countries-including-china-in-same-lines-as-made-by-several-countries\/","title":{"rendered":"Govt approval must for all FDIs from neighboring countries including China, in same lines as made by several countries"},"content":{"rendered":"
\"\"<\/a>
ASSOCHAM Secretary said that by amending the FDI rules through the Press Note No 3 , the Department for Promotion of Industry and Internal Trade, has not only brought the FDI proposals for greenfield investments but also infusion into the existing projects, under the ‘government route’<\/figcaption><\/figure>\n\n\n

The government has amended the Foreign Direct Investment\n(FDI) policy to discourage opportunistic investment in Indian companies by\nneighbouring countries in the midst of the Coronavirus pandemic.<\/p>\n\n\n\n

This comes after China’s central bank recently raised stake\nin Housing Development Finance Corporation (HDFC) to a little over 1 percent.<\/p>\n\n\n\n

As per the new amendment, FDI investments into Indian\ncompanies from the neighbouring countries will now require a nod from the\ngovernment. This will be applicable to all countries that share a land border\nwith India \u2013 such as China among others.<\/p>\n\n\n\n

The amendment specifies that transfer of ownership of Indian\ncompanies arising out of FDI investments from neighbouring countries will now\nalso be subject to government approval.<\/p>\n\n\n\n

Similar FDI restrictions were earlier placed on Pakistan and\nBangladesh.<\/p>\n\n\n\n

These changes were notified via a Press Note by the\nDepartment for Promotion of Industry and Internal Trade (DPIIT).<\/p>\n\n\n\n

As per the note, \u201cGovernment has reviewed the FDI policy for\ncurbing opportunistic takeovers or acquisitions of Indian companies due to the\ncurrent COVID-19 pandemic.\u201d<\/p>\n\n\n\n

The note states: \u201cA non-resident entity can invest in India,\nsubject to the FDI Policy except in those sectors\/activities which are\nprohibited. However, an entity of a country, which shares land border with\nIndia or where the beneficial owner of an investment into India is situated in\nor is a citizen of any such country, can invest only under the Government\nroute.\u201d<\/p>\n\n\n\n

\u201cFurther, a citizen of Pakistan or an entity incorporated in\nPakistan can invest, only under the Government route, in sectors\/activities\nother than defence, space, atomic energy and sectors\/activities prohibited for\nforeign investment,\u201d it said.<\/p>\n\n\n\n

\u201cIn the event of the transfer of ownership of any existing\nor future FDI in an entity in India, directly or indirectly, resulting in the\nbeneficial ownership falling within the restriction\/purview of the mentioned\nsectors, such subsequent change in beneficial ownership will also require\nGovernment approval,\u201d it added.<\/p>\n\n\n\n

The decision will take effect from the date of Foreign Exchange\nManagement Act (FEMA) notification.<\/p>\n\n\n\n

Earlier, reports said that market regulator Securities and\nExchange Board of India (SEBI) was monitoring equity transactions in India by\nChinese companies and banks. Such transactions have come under the scanner at a\ntime when the share prices of companies have dropped due to the economic impact\nof the coronavirus pandemic.<\/p>\n\n\n\n

Globally, transactions by Chinese firms and institutions\nhave come under scrutiny recently since the assets are being purchased at low\nvaluations. Nations such as the US, Japan and Australia have already placed\nrestrictions on Chinese companies buying assets.<\/p>\n\n\n

Source:Amendment of FDI Policy<\/a><\/p>","protected":false},"excerpt":{"rendered":"

The government has amended the Foreign Direct Investment (FDI) policy to discourage opportunistic investment in Indian companies by neighbouring countries in the midst of the Coronavirus pandemic. This comes after China’s central bank recently raised stake in Housing Development Finance … Continued<\/a><\/p>\n","protected":false},"author":1,"featured_media":3808,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15,4,497,493,5],"tags":[311,1013,304,559,354,383,294,324],"class_list":["post-8237","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-corporate-business-advisory-services","category-financial-corporate-services","category-cross-border-transactions-mas-joint-ventures","category-economy-business-updates-corporate-affairs","category-india-international-corporate-updates","tag-corporate","tag-covid-19","tag-foreign-direct-investment","tag-foreign-exchange-management-act-fema","tag-foreign-institutional-investors","tag-hdfc-bank","tag-investment","tag-securities-and-exchange-board-of-india-sebi"],"_links":{"self":[{"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/posts\/8237","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/comments?post=8237"}],"version-history":[{"count":8,"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/posts\/8237\/revisions"}],"predecessor-version":[{"id":8247,"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/posts\/8237\/revisions\/8247"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/media\/3808"}],"wp:attachment":[{"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/media?parent=8237"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/categories?post=8237"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sunkrish.com\/index.php\/wp-json\/wp\/v2\/tags?post=8237"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}