Five amendments to regulations issued by the Reserve Bank of India (RBI) under the Foreign Exchange Management Act (FEMA) between May and October this year were tabled in the Lower House by Minister of State for Finance Namo Narain Meena during Zero Hour.
These amendments seek to provide for 51 per cent foreign investment in multi-brand retail, 100 per cent FDI in single-brand retail and investment by foreign airlines in domestic carriers.
Under the FEMA Act, the government is required to seek Parliament approval on changes in the regulations issued by the RBI.
The government had allowed overseas investors to enter the domestic retail space despite stiff opposition from allies, Opposition parties and small retailers.
After days of disruption, Parliament functioned on Thursday after the government conceded to the Opposition's demand of debate on the issue under the rules that entail voting. The debate will take place in both the houses next week.
The government's decision to allow FDI in multi-brand retail, however, had evoked positive response from industry and global giants like Walmart, Carrefour and Tesco which have been keenly eyeing the Indian market.
The amendments to regulations, however, will have to get Parliament approval as under Sections 47 and 48 of FEMA, the government has to place the amendments to regulations in both the Houses before 15th sitting of the first session after their notification. Once these are tabled, they have to be either approved or disapproved within 30 days. (more)