By Mewati Sitaram
In a significant move, an inter-ministerial panel in India has approved five to six investment proposals in the electronics manufacturing sector, including key proposals from Chinese companies and entities with Chinese ties. This approval is notable as it marks one of the first instances in recent times where Chinese-linked investments have been greenlit, amid ongoing border tensions and heightened scrutiny of Chinese investments in India, according to a report by Economic Times.
Luxshare, a major Chinese electronics manufacturer and a key supplier to Apple. and a joint venture between Indian firm Bhagwati Products (Micromax) and Huaqin Technology, a Chinese company, has been approved. Other approved proposals involve Taiwanese companies that either have beneficial ownership linked to Hong Kong or are listed on the Hong Kong stock exchange.
An official, speaking on condition of anonymity, stated, “Some of these are Taiwanese companies with beneficial owners who have interests in Hong Kong or are listed on the Hong Kong exchange, while a few are genuine Chinese firms.” The approval of these investments reflects the growing pressure from India’s electronics manufacturing sector, which has been advocating for the inclusion of Chinese-linked investments to enhance and diversify the country’s supply chains.
The inter-ministerial panel has already held two rounds of meetings, resulting in the approval of seven to eight proposals across various sectors, with the majority focusing on electronics. This development comes as Indian companies continue to lobby for a re-evaluation of trade ties with China, especially in the context of Press Note 3. The 2020 amendment to India’s FDI policy mandates prior government approval for investments from countries sharing a land border with India, following the India-China border clashes.
Editor in Chief : Mewati SItaram
