China FDI proposals for up to 25% equity may get automatic approval

Sensitive sectors to remain under approval route

The government is looking at easing restrictions for Chinese foreign direct investment (FDI) by allowing companies from the bordering country to invest up to 25 per cent in a company through automatic route. This is being discussed only for non-sensitive sectors such as manufacturing, automobile, services and technology.

“We are deliberating on reverting FDI of certain percentage to the automatic route coming from land bordering nations including China. However, that could only be for sectors where 100 per cent FDI is allowed under the automatic route and pose no risk to national security,” said a government official privy to the