In an effort to woo Chinese investment as part of its 'Make In India' pitch, the government will now be aggressively encouraging Chinese companies to set up their manufacturing units in India.
The home ministry is said to have conceded to the foreign ministry's plea that there need not be an "alarmist" attitude to Chinese investments in India. In an effort to get other ministries on board, home secretary LC Goyal will chair a meeting on Monday with senior representatives from the ministries of communication and information technology, power, Directorate General of Foreign Trade (DGFT), Department of Industrial Promotion (DIPP) and home ministry officials in charge of J&K, North-East and Border Management Divisions.
The effort is to ease up security regulations for Chinese investments here and not have an "arbitrary or unpredictable system" to clear proposals of Chinese investments, a senior foreign ministry official told ET.
The government is trying to now identify sensitive government locations where such Chinese manufacturing units will not be located and also identify those sectors or areas of high technology in which investments from Chinese companies or setting up of manufacturing units by them will not be allowed in India. "Cyber security and areas such as J&K and North-East will still be a no-go for Chinese companies but we wish for concessions to be made elsewhere for making the atmosphere conducive for more Chinese investments in India," the senior foreign ministry official has told ET.
The larger idea is that if China sets up its manufacturing units in India, security concerns will be addressed as a majority of employees and management would be Indians, the official said. "That would also help in employment generation in India and contribute to economic growth," the official added. ET was the first to report on February 6 that the government is planning to make it easier for Chinese companies to invest in India, as it seeks to attract investment from its neighbour and pave the way for friendlier relations between the two countries ahead of Prime Minister Narendra Modi's visit in May.
On the foreign ministry's push, the home ministry is now preparing a more pragmatic policy as so far the Indian security establishment has prevailed over the government and discouraged or stopped Chinese investments in telecom, power, and other sectors on the grounds that these could have implications on national security. There have been concerns about the linkages between the Chinese army and intelligence agencies with their companies, particularly in the telecom sector.
Chinese President Xi Jinping during his visit to India last year promised a $20 billion investment over five years. "But China has complained that this can't happen if it continues to be bracketed with Pakistan, Iran, Somalia, and Sudan in the list of countries whose business houses have to meet stringent visa and security clearance requirements before investing in India," added the official.
Foreign minister Sushma Swaraj, who was in China last week, told an India-China Media Forum that India will make it easier for Chinese companies to do business in India.
There have been a series of meetings between the home and foreign ministries and Intelligence agencies since January on this issue, with India's Ambassador to China, Ashok K Kantha attending at least two of them.
Source:economictimes.indiatimes.com
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