Qatar has reportedly frozen plans to set up a $67m fund for entrepreneurs from France's often-deprived suburbs to set up businesses.
According to reports in France, the Gulf state has put the fund on hold until after the country‘s presidential election.
Le Figaro reported that Qatar had delayed the launch of theinvestment fund to promote employment in the high-rise suburbs, where many French people of Arab origin live, until June.
"Qatar was anxious to launch the fund, but French authorities asked it to wait until after the presidential and general elections," the paper quoted a source involved in the project as saying.
Kamel Hamza, a councillor with Sarkozy‘s party in the Paris suburb of La Courneuve, one of the suburbs targeted by the investment project, told Le Figaro it was "better to wait, given that the election period risks fanning the flame" of criticism.
In January, a far-right presidential candidate in France criticised Qatar's takeover of Paris St Germain football club as well as other investments made in the European country.
Marine Le Pen also hit out at Qatar for investing in "Muslim" areas of French cities.
"The massive investments which it has made in suburbs are made because of the very high proportion of Muslims who are in the French suburbs," she said in comments published by AFP.
Gas-rich Qatar is a traditional French ally and provided vital Arab support to French and British-led efforts to get a UN mandate for military action in Libya.