India Inc has criticised the government's "piecemeal approach" towards foreign direct investment and demanded a clear-cut policy, including a stringent regulatory mechanism and setting up of infrastructural development boards, to raise FDI to 5 per cent of GDP.
Stressing on the need to open up retail sector to FDI and raise sectoral caps except in strategic areas, India Inc wanted conducive conditions to foreign investment.
"Foreign direct investment has to be raised to 5 per cent of GDP. We are of the view that FDI sectoral caps should be hiked in insurance as well. Further, FDI should be allowed in retailing," FICCI President Onkar Singh Kanwar said.
While the decisions to liberalise FDI sectoral caps in some sectors during the last few years were welcome, the government must not continue with this "piecemeal approach", PHDCCI said.
"The government must decide, sooner than later, the sectors in which, on account of national interest, FDI should be restricted or not allowed at all, and allow 100 per cent FDI through automatic route in all others, political compulsions notwithstanding," PHDCCI said.
Pointing out that improving climate is critical to attracting investment, including foreign, CII recommended setting up of a robust regulatory mechanism.
{{/usCountry}}Pointing out that improving climate is critical to attracting investment, including foreign, CII recommended setting up of a robust regulatory mechanism.
{{/usCountry}}CII suggested setting up of Infrastructure Development Boards, which could identify and prioritise a deck of projects and then invite private bids for their implementation.