News: Uniform Indian FDI cap on the way

(TT 17/03/2007) New Delhi - The government today said it is considering a uniform foreign direct investment cap across different businesses in each sector.

India is in the process of reviewing its FDI regulation policy for necessary amendments, commerce minister Kamal Nath said on the sidelines of a seminar organised by the Confederation of Indian Industry (CII).

According to the minister, the government is focusing on those areas that have employment generation potential. “Based on our experiences we will see how it (a more liberal FDI policy) can generate employment,” he said.

A uniform FDI limit within a sector will reduce complexity arising out of caps going up in different business areas within a single sector. For instance within media, technical journals attract a different investment cap, while newspapers and news magazines attract a different investment cap.

Within aviation, airlines attract different rules, while airports attract another set of FDI caps.

“We will see that,” said Nath on whether the government plans to have a single FDI cap for an entire sector.

The FDI policy review has been postponed by a month due to the ongoing budget session of Parliament.