The department of economic affairs has recommended that the beneficial ownership threshold for foreign direct investments should be set at 25% to determine if they need to go through an approval process amid government efforts to restrict Chinese investments in India.

Tarun Bajaj, secretary DEA, said on Thursday that the department has recommended beneficial ownership could be set as per its definition under foreign portfolio investor (FPI) norms and Prevention of Money Laundering Act (PMLA).

Under FPI norms beneficial ownership is set at 25% of the total assets, or on the basis of the fund manager. Under PMLA the threshold is 25%.

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