India is planning to clear 45 investment proposals from China. This initiative might also include those from Great Wall Motor and SAIC Motor Corp, according to the report given by the government and industry sources. This move is expected to ease the military tensions between the two countries at the disputed border.
Around 150 investment proposals from China worth exceeding $2 billion were stuck in the pipeline. Thus, the Companies from Japan and the U.S. routing investment through Hong Kong were also caught in the cross-fire as an inter-ministerial panel led by the home ministry increased scrutiny of such proposals.
Presently, both the government sources who have observed the list has stated that most of the 45 proposals set for early approvals are in the manufacturing sector, that is considered non-sensitive considering the national security.
The sources did not give a detailed picture but two other government officials and two industry sources who are privy to the process commented that the proposals from Great Wall and SAIC are prone to be on the list.
Great Wall and General Motors (GM) made a combined proposal last year seeking consent for the Chinese automaker to purchase the U.S. Company’s car plant in India, in a deal that is expected to be valued at around $250-$300 million.
Great Wall, which plans to devote $1 billion in India over the next few years, announced earlier that establishing operations in the country is a key part of its global strategy. It had planned to start selling cars in India from this year, and was also mulling bringing in electric vehicles.
Great Wall said it continues to seek relevant approvals and investment clearances. The company’s spokesperson says, "Should we be granted all relevant approvals, we will push all work forward in India, abiding by the laws and rules laid down by the Indian government.”
A General Motor’s spokesman states, "We continue to seek all relevant approvals to support the transaction."SAIC, which started selling cars in India in 2019 under its British brand MG Motor, has invested around $400 million of the nearly $650 million it has committed to India and would need approval to bring more investment.
The plan going forward is to split up over 150 proposed Chinese investments into three categories depending on the risk to national security, the sources said. Sectors such as automobiles, electronics, chemicals and textiles are seen as non-sensitive whereas those involving data and finance are deemed sensitive, consultants and lawyers have said. Proposals from non-sensitive sectors will be approved faster, while those seen as "sensitive" will be reviewed later, one of the government sources said.