Congress leader Rahul Gandhi on Sunday said the economic slowdown caused by the coronavirus pandemic has made Indian firms susceptible to foreign takeovers, and that the government must protect corporate entities from “foreign interests”.
“The massive economic slowdown has weakened many Indian corporates making them attractive targets for takeovers,” Gandhi tweeted. “The government must not allow foreign interests to take control of any Indian corporate at this time of national crisis.”
In an exchange filing on Saturday, mortgage lending major HDFC had disclosed 1.01% stake owned by the People’s Bank of China. However, HDFC Vice Chairperson Keki Mistry told NDTV that the Chinese bank had already had 0.8% stake as of March 2019 and the disclosure had been made only now as it had hit the 1% regulatory threshold. Mistry added that the PBOC had been accumulating shares in HDFC for over a year.
The nationwide lockdown in place to contain the spread of the coronavirus has also brought most industry and businesses in India to a grinding halt.
Last week, Italy, one of the countries worst affected by Covid-19, announced changes to its foreign investment policy to protect its banking, insurance and healthcare sectors from hostile takeovers by foreign firms, The Hindu reported. Spain too has made it mandatory for its companies to seek government approval if any foreign company wants to invest more than 10% stake in them.