labels: industry - general, economy - general
Government considers stringent monitoring of foreign investmentsnews
15 July 2006

New Delhi: Addressing security concerns arising out of foreign investments coming into the country, the National Security Council Secretariat (NSCN) has suggested putting in place mechanism to bar acquisitions, mergers or takeovers of Indian companies if there is evidence that a foreign controlling interest might threaten national security.

NSCN has suggested setting up a vigilance team based on the lines of the Committee on Foreign Investment in the United States (CFIUS) to review foreign investments. The NSCN has also mooted including communication network management equipment within the purview of industrial licences governed by the Industries Development and Regulation Act, 1951.

This could have an impact on the plans of equipment manufacturers such as Nokia, Ericsson and Motorola who have announced plans to set up telecom equipment production units in the country.

The NSCN suggestions come after concerns raised by the National Security Advisor about the security implications of Egypt''s mobile telecom company Orascom''s decision to acquire 19.3 per cent stake in the Hong-Kong based Hutchison.

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Government considers stringent monitoring of foreign investments