Why India needs to rethink its policy on FDI from China

The Economic Survey highlighted the potential benefits of increased FDI from China, despite widespread political consensus in India against economic dependence on China. The survey argued this could improve India's integration with global value chains and boost exports. While current policies curb Chinese FDI due to security concerns, the survey recommended more nuanced and transparent screening processes. This could help attract essential investments without compromising national security, particularly benefiting labor-intensive sectors such as textiles and garments. A dynamic, sectoral trade and investment policy with China was also suggested for better economic outcomes.