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India says foreign investment norms will become more open

Pointing that both World Bank and World Economic Forum have looked at India favourably, the Finance Minister said that a few outdated conditions what existed have been either done away with or eased by the Narendra Modi government. “Reforms are an ongoing process”.

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It will be 49 per cent through the government route for MSOs or cable operators not undertaking upgradation of networks towards digitalisation and addressability; broadcasting content services, and terrestrial FM Radio (from 26 per cent).

It has also been decided that an entity which has been granted permission to undertake SBRT will be permitted to undertake e-commerce activities. Excise collections indicates manufacturing sector is moving up.

” Modern Day reforms are another instance of emphasis Optimum Governance, on Minimum Government”. However, there remains a requirement of government approval for foreign shareholdings.

The foreign portfolio investors can also invest up to 74 per cent in private banking. Simplification of procedures for foreign investments, putting more sectors on the automatic route, introducing fungibility between FDI and FII and having a single reference document for all FDI-related guidelines are steps that would boost investor confidence further.

The government has approved four foreign direct investment (FDI) proposals amounting Rs 384 crore based on the recommendations of Foreign Investment Promotion Board (FIPB) including that of pharma firm Lupin. That is higher than the previous cap of Rs.3,000 crore.

In the plantation sector, the government has chose to open up coffee, rubber, cardamom, palm oil tree and olive oil tree plantations for 100 per cent foreign investment under the automatic route.

In construction, for instance, the area restriction of floor area of 20,000 sq. metres in development projects and minimum capitalisation of $5 million to be brought in within the period of six months of the commencement of business, has been scrapped.

Ikea had requested the government to allow a long-term solution to local sourcing, asking that instead of being given five years to procure 30% of local goods from the time the FDI proposal is cleared, time for sourcing norms be calculated from the date of store opening.

Norms have now been changed to allow limited liability partnerships, downstream investment and approval conditions while allowing investment by companies owned and controlled by Non-Resident Indians (NRIs).

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While FDI is a key measure of general overseas investment interest in China, it is a small factor within overall capital flows and when compared to the huge export sector.

Govt clears four FDI proposals worth Rs 384 crore