Hong Kong may come under new FDI rules; custodians to seek clarity

A few days back, the Finance Ministry had notified changes in FDI rules that made prior approval of the government mandatory for foreign investments from countries that share a land border with India

A clutch of custodians got into a huddle last week to discuss whether the new foreign direct investment (FDI) rules should be applied to regions such as Hong Kong and Taiwan.

It was decided that Hong Kong — a special administrative region of China — ought to be brought under the ambit of the new rules despite it not sharing a land border with India, according to the people privy to the discussions. 

The custodians plan to write to the Reserve Bank of India (RBI) and the Department for Promotion of Industry and Internal Trade (DPIIT) for clarity in the matter.

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