India and China were indulged in a high tension affair across the international border. As a direct consequence of the same, India had tightened up the scrutiny and kept many Chinese investments on stand-by. Now though, as both the forces have deescalated their numbers off the borders, India is reportedly looking to give a nod to 45 Chinese investments in India which most probably include Great Wall Motors and SAIC Motor Corp.
According to the government, all these investments are primarily focused on the manufacturing sector and hence are not considered a major threat to national security and integrity and hence rises the possibility of a green flag.
After the SAIC Motor Corp took over GM’s Halol plant to set up operations for brand MG in India, Great Wall Motors had signed an agreement in January 2020 to purchase the American carmaker, GM’s Talegaon plant, which was then subjected to requisite government and regulatory approvals. Under a binding term sheet, the GM India legal entity, which includes the Talegaon facility, was to be transferred to GWM.
Marking then a major milestone in its Indian journey, Great Wall Motor (GWM) had announced the signing of a Memorandum of Understanding(MoU) in June 2020, with the Maharashtra government in presence of the Chief Minister of Maharashtra, Shri Uddhav Thackeray and Mr Sun Weidong, Chinese Ambassador to India.
The company, as per the MoU was to invest $1 billion(about Rs 7600 crores) in the Talegaon plant in a phased manner and the facility was to be equipped with the latest technology. The production plant along with the R&D centre in Bengaluru would have generated employment for over 3000 people in a phased manner. The investment would have gone into upgrading the current plant in Talegaon which was fully functional and had all the infrastructure in place.
In what then came as a big jolt to Chinese auto giant Great Wall Motor (GWM), the Maharashtra Government had put the billion-dollar deal on hold. It was understood that in the wake of the then-recent face-off between Indian and Chinese troops in the Galwan Valley in Ladakh, the Maharashtra government had put on hold three recently announced Chinese investments. This move came following the advisory from the Union External Affairs Ministry which instructed not to sign any further agreements with Chinese companies.
Now, after all this, it finally seems that the Chinese companies will get a nod on their investments in India.