In order to boost the sagging economy the Indian government has Opened the doors to foreign investments, the government liberalised FDI limits in a dozen sectors. It has planned for 100 per cent in telecom and higher limits in ‘state-of-the-art’ defence manufacturing, to boost the sagging economy.
FDI of up to 100 per cent was allowed in courier services under automatic route.
While the FDI cap in defence sector remained unchanged at 26 per cent, higher limits of foreign investments in ‘state-of-the-art’ technology manufacturing will be considered by the Cabinet Committee on Security, Commerce and Industry Minister Anand Sharma said.
In the contentious insurance sector, it was decided to raise the sectoral FDI cap from 26 per cent to 49 per cent under automatic route under which companies investing do not require prior government approval. A Bill to raise FDI cap in the sector is pending in the Rajya Sabha.
“Consensus” on raising FDI limits in some sectors and relaxing the route in others was arrived at a meeting Prime Minister Manmohan Singh held with his key ministers, Sharma said.
It was decided to allow 49 per cent FDI in single brand retail under the automatic route and beyond through the Foreign Investment Promotion Board (FIPB).
Besides civil aviation, Sharma said, no view was taken on relaxing FDI caps in airports, media, brownfield pharma and multi-brand retail.
In case of PSU oil refineries, commodity bourses, power exchanges, stock exchanges and clearing corporations,
The decisions taken today were based on recommendations of Mayaram Committee which had suggested relaxing investment caps in about 20 sectors, but the meeting today approved only in 12.
FDI will be allowed up to 49 per cent under automatic route as against current routing of the investment through FIPB.
Source – PTI