With the CPI(M) coming out tobat for Beijing given that one of the investments being affected was the Vizhinjam port in Kerala, the government was forced to speed up discussions on the matter and take a view.

While security concerns are being seen as a valid issue, the extreme position of the NSC seems to have been put aside now. It’s learnt that key economic and infrastructure ministries are more in favour of identifying sensitive locations and installations in sectors where any FDI proposal will have to undergo a careful screening.

Another argument being made against the country-specific approach is the possible backlash on Indian companies. Given that many Indian majors are looking at acquisitions abroad, a negative fallout of a stringent security policy cannot be ruled out.

While national security interests need to be protected, top government officials explained that the country’s FDI policy needs to be uniform else it would send out wrong signals to the investor community.