New Delhi: The Central Government has liberalized the Foreign Direct Investment (FDI) limits in several sectors on Monday, opening the doors for foreign investments. It has approved 100 percent raise in the telecom sector and also increased the limits in other sectors, mainly to boost up the national economy.  

READ MORE: FDI cap in defence stays unchanged at 26 pc
    
The Foreign Direct Investment (FDI) cap for civil aviation was, however, left unchanged at 49 percent. While the FDI cap in defence sector remained unchanged at 26 percent, 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 told reporters in New Delhi.

READ MORE: No decision on FDI in media
    
In the contentious insurance sector, it was decided to raise the sectoral FDI cap from 26 percent to 49 percent under automatic route according 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 percent FDI in single brand retail under the automatic route and beyond through the Foreign Investment Promotion Board (FIPB). Besides civil aviation, Sharma said that 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, FDI will be allowed up to 49 percent under automatic route as against current routing of the investment through FIPB.
    
The decisions taken were mainly based on recommendations of Mayaram Committee which had suggested relaxing investment caps in about 20 sectors, but the meeting approved only in 12.
    
In basic and cellular services, FDI has been raised to 100 percent from current 74 percent. Of this, up to 49 percent will be allowed under automatic route and the remaining through FIPB approval.
    
A similar dispensation would be allowed for asset reconstruction companies and tea plantations. FDI up to 100 percent has also been approved in courier services under automatic route. Earlier, similar amount of investment was allowed through FIPB route. In credit information firms, 74 percent FDI under automatic route would be allowed.

(Agencies)

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