The lender is the first of China’s Big Four to secure license from India’s central bank.
Indian banks watch out, the Chinese are coming.
Industrial and Commercial Bank of China (ICBC), which has been licensed by the Reserve Bank of India (RBI) to set up commercial operations in India, could well be the first of four banks from China to be allowed to set up local branches. ICBC is the world's largest lender by market capitalisation.
The grant of licence to ICBC comes ahead of proposed discussions between India and China on the "strategic economic dialogue".
Planning commission deputy chairperson Montek Singh Ahluwalia will lead a high powered delegation to Beijing in the last week of this month to define the contours of a framework for enhanced economic cooperation between the two neighbours on a range of sectors covering energy, steel, telecommunication, banking, among others.
China's "big four" government-owned commercial banks also include Bank of China, the China Construction Bank and the Agricultural Bank of China. These have been pressing for regulatory approval from India to start commercial operations on grounds of the "reciprocity principle," a government source, who did not wish to be identified, told HT.
The source said the issue of granting licence to the other three state-owned Chinese banks are likely to feature in the discussions.
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