Because you are doing this;
"we are giving Edit rights at a particular OBS level all PM can see and edit each others project at Germany level."
this obviously stops you from doing this;
"how do i restrict one PM from editing the Projects of other PM's in the same level"
However, when you say;
"Even if I remove the edit rights and give only view rights Projects are editable to other PM's"
Then that sounds wrong - there must be something else going on; if you have removed the edit right to that OBS's data from the group then then group members should not be able to edit that data (unless the group members get that edit right through some other means)
So I think you have the right solution, it is just not implemented in your system correctly - that you only grant view rights at OBS level to the groups, and leave the edit right to the auto-right that that named project manager will get.
(but you really need to understand the other rights that might be confusing your solution)