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New Delhi: India’s revised foreign direct investment (FDI) norms, which aim to prevent the predatory acquisition of domestic firms weakened by the Covid-19 lockdown, have been labelled as “discriminatory” by China.

Beijing said the new policy violates global trading norms under the World Trade Organisation (WTO) and G20 consensus, adding that they should be revised.

“#Chinese investment supports #India’s industry development, creats jobs & promotes win-win cooperation. Our companies actively helps (sic) India fight #COVID19. Hope India revise the discriminatory practices & foster open, fair & equitable business environment,” Chinese embassy spokesperson Ji Rong tweeted Monday.

#Chinese investment supports #India's industry development, creats jobs & promotes win-win cooperation. Our companies actively helps India fight #COVID19. Hope India revise the discriminatory practices & foster open, fair & equitable business environment. https://t.co/Wc94SOs0LH — Ji Rong (@ChinaSpox_India) April 20, 2020

The tweet came two days after India issued an FDI notification Saturday that mandates companies from “border-sharing countries” to seek government approval before making investments in the country.

So far, prior government approval was needed only for firms from Bangladesh and Pakistan, and investments from other countries were allowed under the automatic route subject to sectoral caps and rules.

The revised FDI policy is aimed at curbing opportunistic takeovers/acquisitions of Indian companies due to the current Covid-19 pandemic, said a press note issued by the department of industrial policy and promotion Saturday.

In a separate statement issued by the Chinese Embassy here, Beijing said the new rules had made it “much difficult for companies from countries sharing land border with India, including China, to invest in the country”.

As of December 2019, China’s cumulative investment in India had exceeded $8 billion, far more than the total investments of other border-sharing countries, it said.

“The impact of the policy on Chinese investors is clear. Chinese investment has driven the development of India’s industries, such as mobile phone, household electrical appliances, infrastructure and automobile, creating a large number of jobs in India, and promoting mutual beneficial and win-win cooperation,” it said.

Amid a pandemic situation, China added, both countries should “work together to create a favourable investment environment to speed up the resumption of companies’ production and operation”.

Also Read: Lockdown will test the resilience of even HDFC Bank, Kotak Mahindra and ICICI Bank

‘New FDI rules violate WTO, G20 norms’

Stating that the new rules act as “additional barriers” for investing in India, China said the new notification was in violation of global trading norms under the World Trade Organisation (WTO).

Beijing added that the new rules “do not conform to the consensus of G20 leaders and trade ministers to realise a free, fair, non-discriminatory, transparent, predictable and stable trade and investment environment, and to keep our markets open. Companies make choices based on market principles.”

“We hope India would revise relevant discriminatory practices, treat investments from different countries equally, and foster an open, fair and equitable business environment,” the statement added.

Also Read: Modi must not extend lockdown. Economy won’t survive on ventilator for long

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