Published: Sat, January 13, 2018
Business | By Max Garcia

India woos foreign cos with new norms

India woos foreign cos with new norms

The decisions taken by the Union Cabinet come ahead of Prime Minister Narendra Modi's visit to the World Economic Forum (WEF) meeting in Davos where he will hold discussions with CEOs of top multinational companies on the investment opportunities being thrown open in India.

With more investments, more jobs and income for the nation is expected, and the 49% on Air India came at the wake of government's decision to disinvestment on the carrier. As a major move that will ease foreign investments, the government has approved 100 percent FDI through automatic routing, which will be heavily useful.

"It has now been chose to do away with this restriction and allow foreign airlines to invest up to 49% under approval route in Air India", it said.

Swadeshi Jagran Manch has said that easing the norms for FDI in SBRT would go against the best interest of the country. As the real estate business has been crippled, allowing 100% FDI under the automatic route for real estate broking services can help matters.

By allowing 49% FDI in Air India, the government will likely get more bidders and hence a better valuation.

India has secured robust foreign investment inflows in recent years, but its economic growth has slowed recently.

Deloitte India Partner Anil Talreja said allowing 100 per cent foreign direct investment (FDI) in single brand retail trade should act as a catalyst for a large number of retailers that have been exploring Indian market.

This is the second time that the FDI policy has been changed by the current government. It is therefore, eligible for 100 per cent FDI under the automatic route.

Allowing incremental sourcing undertaken by overseas companies to be counted towards the 30% sourcing commitment for the initial five years will provide them with the flexibility and time to align their retail and sourcing business in India.

However, he said, it was expected that the government's liberalisation of FDI norms for multi-brand retail would enable large worldwide retail chains to invest in the country and bring latest technologies and retail formats into India.

For single brand retail trading, there is no approval required of the Government for 100% FDI.

Like this: