The government on Wednesday cleared the long-discussed proposal to hike foreign direct investment limit in the telecom sector to 74 per cent from the current 49 per cent, Finance Minister P Chidambaram said after Cabinet meeting.
With economic recovery in the rich countries, especially European nations, remaining fragile, FDI inflows to India plunged by 48 per cent to $1.04 billion in January over the same period last year.
The group proposes to invest Rs 10,500 crore in single-brand retail trading in India through a 100 per cent subsidiary.
Meanwhile, Parekh and Ganguly make a strong and compelling case for FDI in retail. Read on
Govt moves to bring in more clarity on definition of 'control'.
India Inc has expressed strong displeasure over the Delhi government's decision to withdraw approval to FDI in multi-brand retail, saying the move was likely to hinder foreign investments flowing into the country.
During November, FDI flows into China, the largest recipient of foreign investment through this route, fell for the 10th time in 11 months, as labour costs rose and an economic slowdown dragged growth down for seven quarters in a row.
Asserting that there is no compulsion for implementing FDI in retail and states are free to decide on it, Parliamentary Affairs Minister Kamal Nath on Wednesday urged all political parties to vote against the Bharatiya Janata Party.
The FIPB, headed by Department of Economic Affairs Secretary Arvind Mayaram, discussed 30 foreign direct investment proposals, including 10 from pharma sector.
Opposing FDI in the retail sector, activist Anna Hazare on Wednesday said the move would lead to enslavement of the countrymen and will not benefit the farmers as claimed by the government.
Telecom Secretary R Chandrashekhar on Thursday said 100 per cent foreign direct investment (FDI) in telecom would not be possible before the 2G auction.
A leading economic think-tank on Thursday advocated allowing foreign direct investment of upto 49 per cent in the retail sector.
Foreign direct investment inflows to India increased by 67.6 per cent year-on-year to $2.38 billion in the first six months of the current fiscal ended September 30.
In private, questions are being raised about the wisdom of a 'dual-SIM' leadership during the long run-up to the 2026 assembly polls where 'family rule' could become an election issue, reports N Sathiya Moorthy.
In 2011-12, 2010-11 and 2009-10, the sector attracted FDI worth $1.99 billion, $1.66 billion and $2.55 billion respectively.
Between 2004-05 and 2007-08, FDI in services leapfrogged to $6.61 billion from $444 million, an official statement said. The real estate sector which was thrown open in 2004-05 saw the FDI picking up slowly in the initial two years, but grew substantially in 2007-08 to $2.17 billion.
The department of telecom will issue guidelines on raising the foreign direct investment limit to 74 per cent from 49 per cent next week.
Chaturvedi said the highest ever FDI flows received by the country were in FY12 at $35.12 billion while in four months of this fiscal alone we have crossed $10.75 billion.
The Railway Minister has announced that there is an urgency to attract FDI in Railway projects.
Breaking his silence on FDI in multi-brand retail, Dravida Munnetra Kazagham chief M Karunanidhi on Monday said his party will not support the Centre's decision to allow foreign investment in the sector.
However, in recent times, the clout that trader bodies such as CAIT and other organisations like Swadeshi Jagran Manch and Laghu Udyog Bharati has is steadily increasing. Earlier this year, trader bodies were able to convince the government not to extend the deadline for implementation of the new norms in FDI policy on e-commerce.
The Finance Ministry further said decision on seven FDI proposals has been deferred.
The government must review its policy to allow foreign direct investment up to 24 per cent in the small and medium scale enterprises, and ensuring better credit facility and technology financing to make them globally competitive.
Sources said in order to address the security concerns, FDI proposals from Pakistan would be routed through the Foreign Investment Promotion Board.
Prices may go up because of higher energy costs, caused by the rise in shipping charges, with commercial vessels taking a longer route to avoid the troubled Red Sea region, the finance ministry said on Monday. Iran-backed Houthi rebels of Yemen are repeatedly attacking ships in the Red Sea. While the global economy is grappling with challenges such as sticky inflation, sluggish growth, and mounting fiscal pressure, India's external sector could face "potential risks" due to the ongoing geopolitical tensions, according to the finance ministry's report on the review of the Indian economy.
The highest FDI came in services ($2.18 billion), followed by automobiles ($1.28 billion), pharmaceuticals ($1.27 billion) and construction development ($1.05 billion) in the 11 months of 2013-14.
The Congress on Saturday saw "no crisis" over the opposition of it allies like Trinamool Congress to the FDI in retail and said that the party was fully behind Prime Minister Manmohan Singh on the issue.
The move comes in the backdrop of a slowdown in the foreign direct investments and its impact on the current account deficit.
Even as the Centre is working overtime to roll out FDI in retail while the real decision might rest with the states, Arvind Singhal, chairman, Technopak Advisors, often referred to as the poster boy of the Indian retail sector, said the so-called big-ticket measure was "not the most important thing"for the sector.
Inter-ministerial body Telecom Commission on Tuesday approved hiking foreign direct investment limit in the sector from 74 per cent to 100 per cent.
Emerging consensus is that all state capitals be covered.
The latest available data from the Reserve Bank of India show a 77 per cent jump in the FDI in the first half of the current financial year (April-September), compared to what was $19.5 billion the same period a year ago.
The Union government is likely to come out with a liberalised foreign direct investment policy in a bid to make foreign investment an engine of growth and create large-scale employment.
Bharti Group said on Thursday that it will not dilute its share in its telecom arm Bharti Televentures even if the government raises the foreign direct investment limit in the sector.
Prominent e-commerce marketplace players include Amazon.in, Flipkart, Snapdeal, Paytm, Shopclues and Jabong
Some new sectors in which the commerce ministry has proposed to allow foreign direct investment (FDI) are credit information companies and commodity exchanges. The ministry is in favour of allowing up to 49 per cent FDI proposed in both these sectors. In proposing to open up the commodity sector, the ministry has said that FII investment be limited to 24 per cent, with a condition that a foreign investor cannot hold more than 10 per cent equity in the investing companies
