The People’s Bank of China (PBOC), China’s central bank, has been quietly building its portfolio in India, while geopolitical relations between India and China remain turbulent. According to data compiled by Moneycontrol from various filings of the Ministry of Corporate Affairs (MCA), the PBOC held shares in at least 35 Indian companies at the end of FY2024. Their portfolio value was around Rs 40,000 crore.
ICICI Bank is PBOC’s top Indian bet in terms of market value. PBOC holds shares worth Rs 6,139 crore in ICICI Bank. The data shows that PBOC holds shares worth Rs 5,344 crore in HDFC Bank, while it holds shares worth Rs 5,303 crore in Infosys. PBOC also holds shares worth Rs 1,414 crore in Government of India-owned Power Grid Corporation.
There has been concern about Chinese investment once before
PBOC was first named in HDFC’s shareholding pattern during the peak of the pandemic in 2020, which had raised concerns about Chinese investment in India. Due to this, finally the Central Government issued ‘Press Note 3’. In this note, Indian Government approval was made mandatory for all those Chinese investors who want to invest in non-listed companies of India. HDFC has now merged with HDFC Bank.
However, there are no restrictions on Chinese investment in listed companies. However, capital markets regulator SEBI has in the past raised concerns over possible misuse of the foreign portfolio investor (FPI) route by Chinese investors to circumvent Press Note 3 restrictions.
In which other companies does PBOC invest in India?
Data shows that PBOC holds shares worth Rs 3,619 crore of IT company TCS. Kotak Mahindra Bank, Hindustan Unilever and Bajaj Finance are the PBOC’s other top bets, with investments worth more than Rs 1,500 crore. Apart from this, PBOC holds shares worth more than Rs 1,100 crore in Maruti Suzuki, Tata Motors and UltraTech Cement. Bajaj Finserv, Tata Motors, Asian Paints, and Paytm parent One97 Communications are among PBOC’s other top bets in India.
According to various media reports, PBOC’s first investment in ICICI Bank came during a qualified institutional placement in 2020. At that time PBOC had purchased Rs 15 crore in ICICI Bank. The PBOC has since increased its exposure to the bank and currently owns 0.67% in ICICI Bank. According to the data, China’s central bank does not hold more than 1% stake in any of its India portfolio companies.
NSDL data showed that currently 17 FPIs with links to China are registered. These include China’s government-owned Best Investment Corporation and Asian Infrastructure Investment Bank. Best Investment Corporation is owned by China’s sovereign wealth fund ‘China Investment Corporation’ (CIC). Data revealed that Best Investment Corporation holds shares worth only Rs 800 crore in companies like Infosys and Power Grid in India.