China investments come under greater scrutiny

Investments from China have been under heightened government scrutiny even before the 15 June Ladakh border clash, two officials aware of the matter said, with an elaborate protocol in place to evaluate them.

In October, the Union home ministry had raised concerns about potentially sensitive investments in critical sectors from ‘certain countries’, given the blurred ownership lines between state-owned and privately held companies in China. Without naming China, the ministry raised concerns over such investments under the automatic route, and sought their scrutiny given security imperatives.

As a stock market crash amid the coronavirus lockdown raised the threat of opportunistic acquisitions by Chinese companies, the government on 18 April made its clearance mandatory for all foreign direct investment (FDI) inflows from countries with which it shares land borders. The state-owned Dedicated Freight Corridor Corp of India Ltd (DFCCIL) on Thursday decided to end a signalling and telecommunication contract worth ₹471 crore with Beijing National Railway Research and Design Institute of Signal and Communication Group, citing ‘poor progress’.

Questions messaged to spokespersons for India's home service and the Chinese government office in New Delhi stayed unanswered. 

The house service's anxiety originates from the way that such speculations are anticipated touchy geologies and in key



areas. 

There have been occasions when India declined to clear telecom gear imported from China after security concerns were raised by the home service and the Prime Minister's Office. India had likewise forced import obligation on power age gear from China. 

"We have been especially dubious of speculations from China in segments, for example, media communications and force as they are of vital significance," the first of the two authorities refered to above said. 

India's influence part is looking at any rate 30 cyberattacks consistently, the vast majority of them from China, Singapore, Russia and Commonwealth of Independent States (CIS) nations, News detailed prior. The Intelligence Bureau had cautioned the administration in 2009 that substations and provincial burden despatch focuses, both key parts of intensity arrange, could be focused on. Substations assume a basic job in the age, transmission and dispersion of intensity.

“Given the nature of such projects and proposals, they are forwarded to the home ministry for seeking clearance," the second official said.

The home ministry has framed a comprehensive standard operating procedure to provide security clearance to such companies and proposals.

reported on Thursday about India exploring restrictions on Chinese portfolio investments in its equity markets.