Piyush Goyal rules out change in govt's stance on Chinese FDI

"It (Economic Survey) is the Chief Economic Adviser's report, it is a report that always gives out new ideas. It is not binding on the government. And there is no rethinking on supporting FDI from China," Goyal was quoted as saying by Moneycontrol.

This stance responds to Chief Economic Advisor Anantha Nageswaran's suggestion in the Economic Survey 2023-24, which advocated for increased FDI from China.

The survey highlights India's growing trade deficit with China, which rose to $85 billion in the last fiscal year from $83.2 billion in 2022-23, and suggests that attracting more Chinese capital could reduce this import dependency.

“Choosing FDI as a strategy to benefit from China plus one approach appears more advantageous than relying on trade. This is because China is India's top import partner, and the trade deficit with China has been growing,” Nageswaran added.

Nageswaran noted that East Asian economies have benefited from increased FDI and that such investments could enhance Indian exports to the US.

This debate occurs amid a decline in India's net FDI inflows, which fell by 3.5% year-on-year to $44.42 billion in FY24, the lowest in five years, according to the latest data from the Department for Promotion of Industry and Internal Trade (DPIIT).