How India stepped up offensive
On Thursday, the Centre announced restriction on purchases for large public projects from companies in countries that share a land border with China
ACTION AGAINST CHINESE INVESTMENTS
Press Note 3 (2020 series) issued on April 17 amended the Foreign Direct Investment (FDI) policy, making prior government approval mandatory for companies from a country that shares land border with India. It closed the automatic investment route for Chinese investments
The action was aimed to prevent opportunistic Chinese takeovers as shares of many Indian firms plunged due to the Covid-19 outbreak
The action was taken after China’s central bank bought a 1.01% stake in HDFC in the first quarter of 2020
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All Chinese FDI proposals scrutinised by the government
All proposals now require security clearances
Prior approval required for transfer of ownership of existing or future ventures Domestic companies may be chary of accepting Chinese investments
nnnnby “hard power” messages, an expert said.
Anupam Manur, assistant professor at the think tank Takshashila Institution, said, “The banning of apps and stopping of
nACTION AGAINST CHINESE IMPORTS
As import of several Chinese goods surged and most of the items entered the market cheaper than its manufacturing cost, India aggressively imposed anti-dumping duties.
There are at least two dozen items under review that will require duty protection from Chinese dumping
These include sodium citrate, USB flash drives, calculators, hot-rolled flat products of stainless steel, Vitamin-e, nylon tyre cord, measuring tapes, compact fluorescent lamps (CFLS), Vitamin-c, flax fabrics, caustic soda, float glass, front axle beam, steering knuckles, hexamine, carbon black, tableware, kitchenware, plastic processing machinery and solar cells
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So far India has imposed anti-dumping duty on about a dozen products in the current calendar year
Imports under 100 categories are under the scanner and may invite action in the due course
The government is also contemplating action as Chinese products are entering Indian market through third countries such as Singapore and Cambodia to circumvent Indian laws
nnnnnACTION AGAINST PUBLIC PROCUREMENT
India on July 23 barred Chinese firms from bidding for public procurement of goods and services on the ground of national security
The order takes into its ambit public sector banks and financial institutions, autonomous bodies, central public sector enterprises (Cpses)and public private partnership (PPP) projects receiving financial support from the government State governments will also participate in this move as the central government writes to all chief secretaries
nnnEFFECT by the not apply to procurement Although, the order does goods and affect procurement of private sector, it will from China services by private companies financial government-controlled
Public sector banks and with Chinese fund private projects institutions may not connections may review already awarded Many state-run companies companies contracts to Chinese dollar participation in multi-billion
The chances of Huawei’s bleak
5G project in India are
nnnnprocurement from China is merely signals of intent and posturing, but when these are not accompanied by actions and show of power, such as a counteroffensive somewhere along the border or building our maritime power in the Indian Ocean and South China Sea, these signals will lose credibility. The reality is that Beijing cannot be deterred without the use of hard power.”
ACTION AGAINST MOBILE APPLICATIONS
On June 29, India banned 59, mostly Chinese, mobile applications such as Tik-tok, Wechat and Helo citing concerns that these are “prejudicial to sovereignty of India, defence of India, security of state and public order.”
The ministry of information technology cited “emergent nature of threats” saying that these apps were “engaged in activities which is prejudicial to sovereignty and integrity of India, defence of India, security of state and public order”
The government is considering more such curbs citing concerns relating to data security and safeguarding the privacy of 1.3 billion Indians
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Huge revenue loss to the Chinese companies that own banned mobile applications as India
China reacted sharply and said that Indian government should protect legitimate rights and interests of in international investors India, including Chinese businesses
But Beijing could not evoke the World Trade Organization rules as
New Delhi was well within its right to take any action to protect its national security interest
nnnSamir Kanabar, tax partner at consultancy firms EY India said, “One would have to evaluate if the Order will delay the bidding process resulting into delay of large infrastructure projects.”