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Govt scrutiny on new portfolio investors from China, Hong Kong: Report

The discussions come weeks after the central government said it will screen all foreign direct investment (FDI) from countries with which it shares a land border

India remains favourite with FPIs despite a steady deterioration in macros
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The two sources added New Delhi is also considering the possibility of mandating a so-called "security clearance" from Home Ministry for new FPI registrants from these nations.

Reuters New Delhi
India has drafted rules proposing tighter scrutiny of new Foreign Portfolio Investors (FPIs) from China and Hong Kong, three government sources told Reuters.

The discussions come weeks after the central government said it will screen all foreign direct investment (FDI) from countries with which it shares a land border, a move it said was aimed at staving off takeovers when asset prices are depressed during the coronavirus pandemic. The Chinese government described the policy as discriminatory.

FDIs are longer-term direct investments that typically provide control over a firm's management. But concerns had risen in the government the policy change could