The Government Is Considering Closer Scrutiny Of Foreign Direct Investment In Sectors Cruc

Madhya Pradesh Election News

The government is considering closer scrutiny of foreign direct investment in sectors crucial to national security, a top government official said, the latest n

Written By mahe sm | Mumbai | Updated On:
national security

The government is considering closer scrutiny of foreign direct investment in sectors crucial to national security, a top government official said, the latest nation looking to tighten oversight amid growing unease about China's acquisition of tech assets.

The industries department is in talks with the ministries looking at finance and internal security, and any changes would include transactions under the so-called automatic route, Industry Secretary Guruprasad Mohapatra said in a recent interview in New Delhi. Under current rules, the Reserve Bank of India seeks some disclosures from companies applying to invest.

Prime Minister Narendra Modi's administration considers India to be one of the most open economies for overseas investment after it eased regulations for several sectors in the past five years. However, governments across the globe have been increasingly blocking the entry of foreign investment on national security grounds, according to a December report from the United Nations Conference on Development and Trade, which identified at least 20 such planned takeovers exceeding $50 million from 2016 to 2019.

"There are some sensitivities in certain strategic sectors on automatic route so discussion is on to see if there should be any intervention," Mr Mohapatra said. He declined to name the sectors.

The government is considering closer scrutiny of foreign direct investment in sectors crucial to national security, a top government official said, the latest nation looking to tighten oversight amid growing unease about China's acquisition of tech assets.

The industries department is in talks with the ministries looking at finance and internal security, and any changes would include transactions under the so-called automatic route, Industry Secretary Guruprasad Mohapatra said in a recent interview in New Delhi. Under current rules, the Reserve Bank of India seeks some disclosures from companies applying to invest.

Prime Minister Narendra Modi's administration considers India to be one of the most open economies for overseas investment after it eased regulations for several sectors in the past five years. However, governments across the globe have been increasingly blocking the entry of foreign investment on national security grounds, according to a December report from the United Nations Conference on Development and Trade, which identified at least 20 such planned takeovers exceeding $50 million from 2016 to 2019.

"There are some sensitivities in certain strategic sectors on automatic route so discussion is on to see if there should be any intervention," Mr Mohapatra said. He declined to name the sectors.

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