With power transmission projects being of a strategic nature, in April, India had tightened clearances amid growing concern that power infrastructure could be targeted by forces looking to cripple its economy. The changes in the foreign direct investment (FDI) policy by mandating government clearance for all FDI inflows from neighboring countries, in order to target Chinese investment in India.
Yesterday, during India’s trade policy review at the World Trade Organization, China expressed ‘deep concern’ over the recent FDI policy changes, as it felt that the changes made in the policy by the government curbed takeovers and acquisitions of Indian companies. The US stated that since India’s last policy review in 2015, simple average tariff increased from 13.5% to 17.6%.
The US and the European Union identified trade barriers, especially recent increase in import duties as key concerns. In the review, which will happen over three days, the US asked the Indian government to reconsider its agricultural support program, following the farmers’ protests in Delhi as it affects the domestic and global market.
Commerce secretary, Anup Wadhawan replied to the concern stated about the farmers’ protests by saying that food security had always been a challenge and the pandemic reinstated the need to focus on India’s public stockholding programs. India has recently been criticized by other countries for the new agricultural farm laws and the MSP provided to the farmers.
The EU representatives expressed their concern over the increased trend of new barriers to trade which have been intensifying due to the Covid-19 outbreak. Few policies in India like GST, import restrictions on IT and telecom products were changes that were welcomed by some countries.
India also said that it was committed to making sure that its citizens would be inoculated effectively and the country’s vaccine production and delivery capabilities would be fully explored during these trying times.