Giving up its concerns over Chinese investors, the government is ready with a deal to attract investment from companies from across the border in “industrial parks“, which are expected to include special economic zones and manufacturing zones.
The proposed deal signals the Narendra Modi government's changing stance on economic diplomacy since the proposal has been in the pipeline for close to two years but is only making its way to the Union Cabinet now. Sources said the Cabinet is scheduled to discuss a memorandum of understanding (MoU) with China on cooperation over industrial parks on Wednesday .
The move follows a proposal from China to invest in select zones, including some sector-specific projects.
While security clearances have in the past held up several projects involving Chinese investment, approvals will be required even with the MoU in place, officials said. “But it marks a big change as, for the first time, we are looking to cooperate on investments,“ said an official. Japan and South Korea are already in talks with the government to cooperate in investment in industrial enclaves and China will be the third country with which an arrangement is being finalized.
Commerce & industry minister Nirmala Sitharaman had said that she did not look at China as a threat but instead viewed it as an opportunity. “Many things China wants to export to us can be produced here, whereby our employment will increase, production for our market will happen but with investments coming in. But, I am looking at commerce ministries to engage with China to make sure we are drawing more investments from them,“ the minister had said.
While several Chinese companies such as Huawei and ZTE have invested in India, the going has not been easy for them given the security concerns.
The proposed MoU is seen as the first step towards greater investment cooperation.
China has also proposed to fund 30% of India's infrastructure requirement, although government officials said a decision on the issue was yet to be taken since the details are missing.
The proposed deal signals the Narendra Modi government's changing stance on economic diplomacy since the proposal has been in the pipeline for close to two years but is only making its way to the Union Cabinet now. Sources said the Cabinet is scheduled to discuss a memorandum of understanding (MoU) with China on cooperation over industrial parks on Wednesday .
The move follows a proposal from China to invest in select zones, including some sector-specific projects.
While security clearances have in the past held up several projects involving Chinese investment, approvals will be required even with the MoU in place, officials said. “But it marks a big change as, for the first time, we are looking to cooperate on investments,“ said an official. Japan and South Korea are already in talks with the government to cooperate in investment in industrial enclaves and China will be the third country with which an arrangement is being finalized.
Commerce & industry minister Nirmala Sitharaman had said that she did not look at China as a threat but instead viewed it as an opportunity. “Many things China wants to export to us can be produced here, whereby our employment will increase, production for our market will happen but with investments coming in. But, I am looking at commerce ministries to engage with China to make sure we are drawing more investments from them,“ the minister had said.
While several Chinese companies such as Huawei and ZTE have invested in India, the going has not been easy for them given the security concerns.
The proposed MoU is seen as the first step towards greater investment cooperation.
China has also proposed to fund 30% of India's infrastructure requirement, although government officials said a decision on the issue was yet to be taken since the details are missing.
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