New Delhi [India], Apr 18 (ANI): The government has introduced stricter measures to curb opportunistic takeover of Indian companies due to the current COVID-19 pandemic by firms in neighbouring countries.
Earlier this week, several west European countries including Germany, Italy and Spain tightened their foreign direct investment (FDI) rules to prevent Chinese firms from taking over their companies which are facing slumping sales due to coronavirus pandemic.
According to a statement issued by the Department for Promotion of Industry and Internal Trade (DPIIT), the government said that an entity of a country which shares a land border with India can invest only after receiving government approval.
"However, an entity of a country, which shares a land border with India or where the beneficial owner of investment into India is situated in or is a citizen of any such country, can invest only under the government route," said the statement.
The new rules will also apply to the transfer of ownership of any existing or future FDI in an entity in India directly or indirectly, the DPIIT said.
On the other hand, the already tight rules for citizens of Pakistan remain the same, and sectors such as defence, space, atomic energy and sectors continue to remain prohibited to them, it said.