According to the exclusive information received by CNBC Awaaz, after the reduction of tension on the border, there is a readiness to relax the conditions related to China on the economic front too. According to sources, the terms of FDI coming from China can be eased. Relaxation is possible in sectors that are not directly connected to national security. At the same time, FDI conditions in the national security sector will not be relaxed. Explain that after the dispute over the border increased, the government had toughened the FDI conditions. According to sources, it is possible to consider relaxing the rules related to other business relations with China.
According to sources, the issue has been discussed at the level of cabinet secretary and finance ministry. Apart from this, it has also been discussed in the Ministry of Home and Commerce.
Explain that in April 2020, the Government of India clamped down on FDI coming to India from China and other border countries. In April, FDI investments from border countries such as China and Pakistan were committed to curb opportunistic acquisitions and mandate official approval for automatic FDI in general.
According to information quoting sources attached to the matter, with the easing of tension on the border between India and China, now these rules may soften.
According to sources, the government has many options that it can consider. These options include FDI approval of up to 25 or 26 per cent in sectors earmarked for automatic form. However, no such relaxation will be given in sectors related to national security. Apart from this, the government will not give any such exemption which will cause any harm to local industries.
For all the products, the government has extended the compliance date for quality control instructions as domestic industries are not in a position to follow these rules immediately. Apart from this, all the products in this category like toys come mainly from China.
Please tell that after the clash between the Indo-Chinese soldiers in the Galvan Valley in eastern Ladakh, the tension between the two countries had increased greatly. After this clash, India tightened imports of all Chinese products through changes in quality control and import policy. Apart from this, the ban on all Chinese apps was banned from the government’s purchase from China. However, some of these steps were also taken to support domestic industries. After the imposition of such restrictions, there was also some concern in the government about its impact as all the projects going on in the country were run with the cooperation of China. At the same time, domestic capacity is very limited in many sectors. Keeping all these in mind, softening of trade policy towards China is now being considered.