CHINA TOPIX

Updated 8:47 AM EST, Fri, Mar 05, 2021

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India Plans to go Tough on Chinese Companies After Beijing Snubs New Delhi on 'Masood Azhar' Issue

India Plans To Go Tough on Chinese Companies

(Photo : Getty Images.) New Delhi is reportedly reviewing its liberalized investment policy for Chinese companies, after China China snubbed India last week in UN on "Masood Azhar” issue.

New Delhi is resorting to tit-for-tat policy after China snubbed India last week by blocking India's move to bring Pakistani militant "Maulana Masood Azhar" under the United Nation's black list.

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According to sources, security establishments in New Delhi want to review India's recent liberalized investment policy for Chinese companies. Bringing China back in the list of "country of concern" is one of the many moves that officials in New Delhi are seriously mulling over.

"It cannot be a one-way affair. If Beijing is blocking our efforts on the international forum aimed at addressing our security concerns, maybe we should review the security clearances to Chinese investment proposals by citing "national security" clause, or at least rethink on future cases put up for security clearance," a top security officer told a local Indian newspaper.

India has taken a number of initiatives to promote Chinese investment in India after Indian Prime Minister Narendra Modi's successful visit to China last year. One such initiative was to remove China from the list of "country of concern," which in the past had led to many Chinese investment proposals being rejected on pretext of security concerns.

New Delhi's positive overture towards Chinese Companies led to a sharp rise in Chinese investment over the years. According to the Department Of Industrial Policy and Promotion (DIPP), Chinese companies invested Rs 3,066.24 Crore in 2014-15 and Rs 2,196.11 crore in 2015-16.

China's major telecom company Huawei Telecommunications was also one of the major beneficiaries of the government's liberalized investment policy. In mid 2015, India's Home Ministry approved Huawei's proposal to set up a manufacturing plant in Tamil Naidu.

China's Difficult Relationship with India 

China shares a difficult relationship with India because of unresolved border disputes. The Indian state of Arunachal Pradesh is also an area of contention between the two countries, with China claiming Arunachal Pradesh as its own. Both countries have also fought war in 1962 to settle border dispute.

China's economic and military assistance to India's arch rival "Pakistan" over the last two decades has further complicated relationship between two countries.

The general feeling among Indian foreign policy expert is that close diplomatic ties between Beijing and Islamabad is purely based on both countries mutual mistrust towards India.

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