India's envoy to China says more Chinese investment would be good for the broader bilateral relationship

India's Ambassador to China has publicly endorsed greater Chinese investment in India, saying it would strengthen the overall bilateral relationship between the two Asian giants. The statement, reported by The Hindu, is one of the clearest signals yet from an official Indian interlocutor that New Delhi's stance on Chinese capital may be softening after years of heightened caution.

Relations between India and China deteriorated sharply following the deadly Galwan Valley border clashes in June 2020, after which India imposed stringent restrictions on Chinese investment and blocked hundreds of Chinese apps. Since then, both governments have taken cautious steps towards normalisation, including a disengagement agreement along the Line of Actual Control reached in late 2024.

The envoy's remarks come against that backdrop of gradual thaw. Proponents of greater Chinese investment argue that it could help India attract manufacturing capacity — particularly in sectors like electronics and electric vehicles — as global companies seek alternatives to China-centric supply chains. Analysts note that Indian industry has been divided on the issue, with some welcoming the capital and technology transfer while others caution against strategic dependencies.

The statement does not signal a formal policy change, but it does suggest that the conversation within the Indian government about the costs and benefits of Chinese investment is evolving. Any concrete liberalisation of investment rules would require careful navigation of both strategic concerns and domestic political sensitivities.