China asks India to revise new FDI rules, says they violate WTO free trade norms
India’s new rules for foreign direct investment (FDI) violate WTO principles of non-discrimination and are against free and fair trade, a Chinese embassy spokesperson in New Delhi said on Monday.
“The impact of the policy on Chinese investors is clear,” a spokesperson of the Chinese embassy Ji Rong said in a statement.
On Saturday, India made a grant of prior approval mandatory for foreign investments from countries that share a land border with India to curb "opportunistic takeovers" of domestic firms following the coronavirus pandemic.
Responding to which, the official said the new policy introducing "additional barriers" was also against the consensus arrived at the G20 grouping to realize a free, fair, non-discriminatory and transparent environment for investment.
"The additional barriers set by the Indian side for investors from specific countries violate WTO''s principle of non-discrimination, and go against the general trend of liberalisation and facilitation of trade and investment," Chinese embassy spokesperson Ji Rong said in a statement.
The existing FDI policy only allows Bangladesh and Pakistan through the government route in all sectors, but now the companies from China and other neighbouring countries will also have to take the government route.
Currently, investment by foreign companies in India is allowed under two routes, either from the automatic route in which companies don’t have to take the approval from the government or through the government route, in which the companies have to take the approval from the government of India.
