The government has eased foreign investment norms that would expedite clearance from authorities for investments up to Rs 1,200 crore ($250 million).
As per the existing norms, all foreign investment proposals which are of the size of over Rs 600 crore ($125 million) has to be cleared by the Cabinet Committee on Economic Affairs (CCEA), comprising top ministers. Under the new directive, the minimum investment limit for this procedure has been doubled to Rs 1,200 crore.
The limit was raised based on the recommendations by the commerce and industry ministry which markets India as an investment destination to foreign investors.
At present, companies apply to the Foreign Investment Promotion Board (FIPB), the nodal body clearing foreign investment proposals in the country, who in turn refers the proposal to the CCEA if the project involves money worth Rs 600 crore or more. Now FIPB will be able to clear larger investment projects.
This will arrest delays in giving approval to a large number of investment proposals in the country by foreign companies. It is aimed to promote India as a foreign investment-friendly destination. Besides it will also save time for CCEA for other matters. In turn, this also makes the finance ministry even more powerful as the FIPB is seen as a part of the ministry.