Amid the US tariff war, the Centre is reportedly planning to cap Chinese investments in electronics joint ventures at 10%, contingent on technology transfer, prioritising local manufacturing development.
An ET report, citing officials privy to the matter, said that preference will be given to electronics contract manufacturers or supply chain firms from the neighboring country, rather than Chinese brands, when it comes to equity ownership.
“As the Indian firms need technology transfer, the government is likely to allow 10% Chinese equity in joint ventures. But there won’t be open gates for Chinese investments in electronics or other sectors,” an official said.
The officials also told ET that the government is willing to adjust the rules on Chinese equity if the US or European companies seek to shift operations from China to India. In such cases, Chinese suppliers to these firms may be allowed to hold up to a 49% stake, though this would be treated as an exception and each application will be evaluated separately.
This comes at a time when Chinese companies are showing increased willingness to meet investment conditions, propelled by the US tariff war.
(The story will be updated soon)
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