Raj Narayan Verma, Chanakya National Law University
CHAPTER 1: INTRODUCTION
An investor who makes an investment in a firm from a country other than his own is said to be making a foreign direct investment (FDI). A contribution of 10% or more through appropriate instruments to an Indian listed firm would be considered foreign direct investment.
It implies a long-term interest and ownership rather than just investing money in assets in another nation. New technology, technological expertise, skills, job possibilities, and enhanced infrastructure are all brought in by foreign direct investments.
In order to protect their long-term interest, foreign investors are granted at least 10% voting rights in the operations of the company where their investment is being made, giving them some level of influence over management.
However, we should be aware that FDI also has some drawbacks, including the possibility of increased capital outflows, the disruption of local corporate operations, and even the possibility of foreign governments interfering in domestic affairs, which will be the main topic of this study.
The first section describes the existing situation of Chinese investments in India and any issues that may occur; the second section details the actions taken by the GOI, including changing the FDI policy and prohibiting some Chinese applications. I'll explain India's FDI policy laws in the third section.
