India's additional barriers for FDI is discriminatory, says China

A farmer wearing a face mask is seen sitting on sacks of wheat grain amid a nationwide lockdown, in Bathinda, on Monday. Pic/PTI

India's new norms featuring "additional barriers" for foreign direct investment from specific countries violate WTO's principle of non-discrimination and are against the general trend of free trade, a Chinese embassy spokesperson said on Monday.

The impact of the policy was clear on Chinese investors, the official said, adding India's action was also against the consensus arrived at the G20 to realise a free, fair and non-discriminatory environment for investment. Last week, India made prior clearance by the government mandatory for foreign investments from countries that share land border with India to curb "opportunistic takeovers" of domestic firms following the Coronavirus pandemic.

Chinese embassy spokesperson Ji Rong said China hoped that India would revise the "relevant discriminatory practices" and treat investments from different countries equally while fostering an "open, fair and equitable" business environment.

India's decision to tighten norms for FDI came amid reports of China eyeing to take over several Indian entities following fall in their valuation after the economic downturn in the wake of the pandemic.

"The additional barriers set by Indian side for investors from specific countries violate WTO's principle of non-discrimination, and go against the general trend of liberalisation and facilitation of trade and investment," the spokesperson said in a statement.

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