India signals thaw in China curbs to boost electronics ties

Indian electronics manufacturing would likely see some collaboration with Chinese companies, a top federal official said, signalling a thaw in hitherto enforced strict investment curbs in light of Beijing's dominant three-fifths share in the global electronics ecosystem. "We want to grow our manufacturing capacity. So, some sort of collaboration with China is something we can't avoid," said the official, who declined to be named. "Therefore, we have to be strategic about what we do, and how we do it. But, it has to be done."

The official's comments follow the federal nod to a deal between home-grown Dixon Technologies and Chinese original design manufacturer, Longcheer Intelligence Pte. Earlier this month, the Niti Aayog had reportedly proposed that Chinese firms be allowed to acquire up to a 24% stake in Indian companies without requiring additional security clearances. In place since 2020, the Department for Promotion of Industry and Internal Trade's guidelines mandate foreign direct investment from neighboring countries need prior security clearance from both the Ministry of Home Affairs and the Ministry of External Affairs.