Saturday, February 3, 2007

Government to review FDI policy in March

The Indian Government is considering a number of changes in the current foreign direct investment (FDI) policy governing the activities of the various foreign entities invested and wanting to invest in India. Some of the proposals include –

· Acquisition of stake in Indian commodity exchanges by foreign investors
· Annual reviews of FDI policies in all sectors instead of one sector a month as at present
· Removal of the mandatory clause for petroleum companies to disinvest 26% in Indian subsidiaries in five years
· Review of the 10% cap on voting rights in subsidiaries of foreign banks
· Hike in the 49% cap in air transport services including activities like charter flights, ground handling and helicopter services and clear definition of all aviation activities and the relevant FDI cap
· Increase in the FDI cap in retail, currently at 51% in single-brand retail and 100% in wholesale cash-and-carry

The proposal would be submitted to the Union Cabinet this March.

Read more in the Business Standard article.

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