China complains; says India's new FDI norms violate WTO principles & liberalisation trend

India's new FDI norms for investors from specific countries violate WTO's principle of non-discrimination, the Chinese Embassy said in a statement on Monday. It added that India's new FDI norms go against the general trend of liberalisation and facilitation of trade and investment.

The official said the new policy introducing "additional barriers" was also against the consensus arrived at the G20 grouping to realize a free, fair, non-discriminatory and transparent environment for investment.

"The additional barriers set by Indian side for investors from specific countries violate WTO's principle of non-discrimination, and go against the general trend of liberalisation and facilitation of trade and investment," Chinese embassy spokesperson Ji Rong said in a statement. 

This comes after India amended its foreign direct investment (FDI) policy to prevent the hostile takeover of stressed firms amid the COVID-19 pandemic via the automatic FDI route.

Earlier, China seemingly responding to India's move had said that it has done nothing but act as a 'responsible country' and has proven its international cooperation. Chinese Ambassador to India Sun Weidong in a series of tweets said that China had been the first to alert the world regarding the pandemic and that it had helped become the 'world's factory' by decreasing the strain on global medical supplies. He stated that at a time like this 'cooperation' was needed instead of 'scapegoating'. 

India amends its FDI policy

In massive development, the Centre on Saturday, amended the  Foreign Direct Investment (FDI) policy to ensure no hostile takeover of firms facing stress due to ongoing COVID-19 lockdown. According to the amendment, neighbouring countries - including China, Nepal, Bangladesh, Pakistan will require government approval for investing into Indian companies. Centre has also prohibited Pakistan from investing in Indian sectors of defence, space, atomic energy and sectors/activities prohibited for foreign investment. Apart from India, EU, US, Australia have checked Chinese FDI amid COVID-19 crisis. China's People's Development Bank had just last week picked up an over 1% stake in India's largest private lender HDFC bank.