(MENAFN- KNN India)
New Delhi, Aug 22 (KNN) In a significant policy shift, an inter-ministerial panel in India has approved several investment proposals in the Electronics manufacturing sector.
This includes investment proposals from Chinese companies and firms with Chinese affiliations, according to a report by ET.
The panel has granted approvals to notable entities such as Luxshare, a major Chinese electronics firm and Apple vendor, as well as a joint venture between India's Bhagwati Products (Micromax) and China's Huaqin Technology, where the latter holds a minority stake.
Additionally, several Taiwanese companies listed on the Hong Kong Stock Exchange or with Hong Kong investments have received clearance.
This decision marks a departure from the stringent restrictions imposed on Chinese investments following border tensions between India and China in mid-2020.
The move comes amid mounting pressure from the electronics manufacturing industry, which has faced significant challenges due to these restrictions.
Industry sources report production losses of USD 15 billion and job losses of approximately 100,000 over the past four years.
The inter-ministerial panel, which has met twice thus far, has approved seven to eight proposals across various sectors, with a majority in electronics.
Future meetings are scheduled every six to seven weeks to review new investment proposals.
Approvals are contingent on specific conditions, including limitations on Chinese nationals in key executive roles and restrictions on Chinese companies to minority stakes in partnerships with Indian firms.
This policy adjustment aims to broaden and deepen local supply chains in the electronics sector.
The Indian electronics industry has also been advocating for a substantial production-linked incentive (PLI) package of approximately Rs 30,000-35,000 crore to support the projected USD 75-80 billion demand for electronics components by 2026.
The government's decision to ease restrictions on Chinese investments in the electronics sector represents a delicate balance between national security concerns and economic imperatives.
As India seeks to reduce its import dependency and address its trade deficit with China, this move could potentially reshape the landscape of electronics manufacturing in the country.
(KNN Bureau)
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