Government relaxes FDI norms in 15 sectors, PM says 'India unstoppable on path of economic progress'

As the Centre on Tuesday pushed for Foreign Direct Investment in as many as 15 sectors, Union Finance Minister Arun Jaitley said that the country needs infrastructure for new ventures and FDI "is an additionality to it".

Pointing that both World Bank and World Economic Forum have looked at India favourably, the Finance Minister said that some outdated conditions what existed have been either done away with or eased by the Narendra Modi government.

While the government has decided to allowed 49 per cent FDI in Defence sector made through automatic route, it has also allowed 100 per cent FDI in non-news channels through the same.

In addition to this, the government will allow 49 per cent FDI in news channels through FIPB route.

The foreign portfolio investors can also invest up to 74 per cent in private banking. Apart from this, there will be 100 per cent FDI in teleports, DTH, cable networks and 49 per cent in regional transport.

Addressing a press conference in the national capital over the reforms, Jaitley said, "The most important reform has been in the construction sector. We hope the sector will pick up."

"India has become one of the most important investment destinations...the trend of India declining in ease of doing business has been reversed," said Jaitley.

"In last few months the growth in India has been driven by public investment, some private investment and increased FDI," he added.

The Finance Minister further said that FDI inflows in last one year had increased by 40 per cent, adding that the foreign investment required for cycle of economic activity has to go on.

Talking about the reform agenda, Prime Minister Narendra Modi said, "Today's reforms are another example of emphasis on Minimum Govt, Maximum Governance...India is unstoppable on path of economic progress. Government wants the world to see the tremendous opportunities India offer."

He further said that the government's "commitment to development and reforms is unequivocal and unwavering".

The government relaxed conditions for FDI in single-brand retail and allowed 100 per cent FDI under automatic route in duty-free shops and Limited Liability Partnerships (LLP) and eased foreign investment norms in the defence sector.

It has also raised the FIPB's monetary limit to Rs 5,000 crore from Rs 3,000 crore for approving FDI proposals.

"The government's decision on liberalising FDI policy is a welcome step and is part of improving ease of doing business. These decisions come into force with immediate effect," Economic Affairs Secretary Shaktikanta Das said.

DIPP Secretary Amitabh Kant said: "This is Diwali gift for investors. This is the biggest bang reform of the government."

In the construction development sector, minimum capitalisation norms and floor area restrictions have been removed. The government has also eased exit norms for foreign players in the sector.

"Hundred per cent FDI under automatic route has been allowed in completed projects for operation and management of townships, malls/shopping complexes and business centres," the commerce and industry ministry said in a statement.

(With PTI Inputs)