Outlook, February 12, 2020
MPs across party lines support private member’s Bill
Several Rajya Sabha members cutting across party lines on Friday supported a private member’s Bill, which seeks to set up a committee to scrutinise foreign investments in financial services, critical infrastructure and technology sectors having bearing on national security.
Members hailing from the BJP, the Congress and other parties raised concerns over data security and said it was an issue of national security and that there was a need to ensure that foreign direct investments (FDI) in sectors such as financial services are scrutinised.
The members were taking part in a debate on the Foreign Investment in Financial Services, Critical Infrastructure and Technology Affecting National Security (Regulation) Bill, moved by Narendra Jadhav, a nominated member of Rajya Sabha.
The Bill was moved by Jadhav on December 6, 2019 during the last session, but he could not conclude his opening speech then. He concluded his submission on Friday.
According to Jadhav, the FDI level has increased to an unprecedented level $284 billion and “we are still giving a free hand to foreign investors” in sensitive areas such as financial sectors in the rapidly changing digital environment.
“What about NBFCs and payments firms? There is no limit for foreign ownership of NBFCs. 100 per cent ownership is allowed in this through automatic route,” he said.
“Can we simply sit and allow the foreign firms have controlling stake in NBFCs and payment firms? We simply cannot. The cost of inaction would be huge national security risk. There is also absence of data protection law in this country and we are finally moving in that direction,” said Jadhav, who is also an economist, educationist and public policy expert.
This will make personal and financial data of millions of Indians available to foreign governments, which would include the data of key politicians and military personnel, and “this could be misused and weaponised”.
“These data could be misused and undermine our national security. We must act and act without any further delay,” he said.
The Bill seeks to establish a committee on foreign investment headed by the Economic Affairs Secretary to effectively guard against the risk to national security posed by certain types of foreign investment in financial services, critical infrastructure and technology sectors.
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