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Government decisions on easing FDI norms in sectors like multi-brand retail, defence and telecom will now take immediate effect with Commerce and Industry Ministry today issuing press notes in this regard.
The Union Cabinet on August 1 approved liberalisation of FDI norms in a dozen sectors, including raising the cap to 100% in telecom and allowing 49% foreign investment in single brand retail under the automatic route and beyond through the Foreign Investment Promotion Board.
The other sectors in which the government relaxed the FDI norms include PSU oil refineries, commodity bourses, power exchanges, stock exchanges, clearing corporations, asset reconstruction companies, tea plantations and courier services.
All these decisions "will take immediate effect", the Press Notes said.
The Department of Industrial Policy and Promotion (DIPP) has defined the term "control" with Press Note 4 of 2013 series and relaxes norms in multi-brand retail like sourcing conditions with the Press Note 5.
In the Press Note 6, the DIPP has mentioned about sectors like defence in which the government has allowed FDI above 26% but it needs to go through Cabinet Committee on Security (CCS).
"Above 26% to CCS on case to case basis, which ensure access to modern and state-of-art technology in the country...Investment by FIIs through portfolio investment is not permitted," the Press Note said.
It also said that applications for FDI up to 26% will follow the existing procedure with proposals involving inflows in excess of Rs 1,200 crore being approved by CCEA.
"Applications seeking permission of the government for FDI beyond 26% will in all cases be examined additionally by the Department of Defence Production (DoDP) from the point of the view particularly of access to modern and state-of-art technology," it added.
The Note said that based on the recommendation of the DoDP and FIPB, approval of the CCS will be sought by the DoDP in respect of cases which are likely to result in access to modern and state-of-art technology in the country.
"Proposals for FDI beyond 26% with proposed inflow in excess of Rs 1,200 crore, which are to be considered by CCS will no require further approval of the CCEA," it said.
