Cabinet to take up FDI policy review this week: Nath | business | Hindustan Times
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Cabinet to take up FDI policy review this week: Nath

The FDI policy that has been on the works for the last few months, could allow public sector oil companies to divest upto 49% equity in refineries, reports Gaurav Choudhury.

business Updated: Nov 26, 2007 20:57 IST
Gaurav Choudhury

The much-awaited foreign direct investment (FDI) policy review that proposes to raise investment ceilings in key sectors including real estate, aviation, commodity exchanges and petroleum refining would be taken up by the union cabinet this week.

Commerce and industry minister Kamal Nath said on Monday that apart from the FDI review, the Comprehensive Economic Cooperation Agreement (CECA) with Singapore is also listed for approval of the Cabinet this Thursday.

The FDI policy that has been on the works for the last few months, could allow public sector oil companies to divest upto 49 per cent equity in refineries.

It could also allow foreign institutional investors (FIIs) to participate in public issues of realty companies. It is also proposed to allow 100 per cent FDI in mining of titanium bearing minerals, its value addition and integrated activity. FDI upto 100 per cent would be allowed only if the value addition facilities are set up within India along with transfer of technology.

FDI in some areas of the aviation sector--chartered airlines, cargo and ground handling services—is likely to be allowed upto 74 per cent from the current 49 per cent. However, investment by foreign airlines, directly or indirectly in India’s aviation sector might still be far away with the Civil Aviation ministry not in favour of such a move.

FDI ceiling would also be allowed up to 49 per cent, including FII investment upto 24 per cent in listed entities, in credit information companies and commodity exchanges.

It is also proposed to allow 100 per cent FDI in mining of titanium bearing minerals, its value addition and integrated activity. FDI upto 100 per cent would be allowed only if the value addition facilities are set up within India along with transfer of technology.

Earlier, speaking at a Confederation of Indian Industry (CII) function here, Nath said India and Malaysia would begin negotiations for bilateral CECA from January 2008.

Dato’ Seri Rafidah Aziz, Minister of International Trade and Industry, Malaysia said that Indian human resource has assumed a key role in Malaysia’s economic development as Indian national account for 19.6 per cent of the total expatriate in Malaysia.