The sharp opposition in Europe to Mittal Steel's takeover bid for European steelmaker Arcelor has sparked angry reactions in India.
When the world's third richest man, Indian-born Lakshmi Mittal, made an unsolicited $23 billion bid for European steelmaker Arcelor last month, he ruffled many feathers in Europe.
The Netherlands-based Mittal group has become the world's largest steel company through a series of acquisitions. A merger with Arcelor would make it three times bigger than its nearest rival, creating an industry giant accounting for about 10 percent of the world's steel output.
Luxembourg-based Arcelor opposes the bid by Mittal on the grounds that the two companies have different corporate cultures and values, and the bid is too low.
In countries where Arcelor has big operations - France, Luxembourg and Spain - trade unions say they are worried about job losses, and there have been calls for the deal to be blocked amid a political outcry.
India says many of these objections may be rooted in prejudice and discrimination. Both the government and the business community are urging European countries to look upon the acquisition bid as a simple business venture.
The sharpest comments have come from Indian Trade Minister Kamal Nath, who has urged countries to wake up to the new economic architecture being shaped by emerging economies like India and China. Nath says, in an era of cross-border investment and globalization, investors should not be judged by the color of their skin.
"We would like to see that national treatment is accorded on all cross-border investments; it is not the passport or the color of a person," Nath said. "These are the issues to be settled by shareholders, by experts of the industry, and governments cannot get involved in this."
Trade Minister Nath has also expressed concern to the European Union that opposing the Mittal bid may violate World Trade Organization rules on cross-border investment.
On a recent visit to New Delhi, European Union Director General of Trade David O'Sullivan tried to dispel concerns that the hostile reaction to the takeover bid may be rooted in discrimination. He said "nationality is not relevant," and the issue should be decided according to commercial merits.
"The European Commission's role in this kind of situation is to be the guardian of fair competition," said O'Sullivan. "If fair competition issues arise, then the commission may be asked to take a view. If not, it is a matter between shareholders of the company."
Indian businesses, which have made forays into several overseas countries to buy up businesses in recent years, are also watching the controversy closely.
Amit Mitra, secretary general of the Federation of Indian Chamber of Commerce and Industry, sums up the feelings of Indian businessmen.
"I think the sentiments are high only because one feels that, here is a person of Indian origin trying to take over in what we feel is a legitimate manner, a European company of huge size, and there seem to be roadblocks," Mitra said.
On Thursday, Arcelor reported strong results, with a $4.5 billion net profit for 2005. The management said the results showed Arcelor had good growth prospects, and reiterated that the Mittal bid undervalued the company.