'FDI relaxation to help attract foreign investors'
Jan 13 2018 by Johnny Bowman
The decisions taken by the Union Cabinet come ahead of Prime Minister Narendra Modi's visit to the World Economic Forum (WEF) meeting in Davos where he will hold discussions with CEOs of top multinational companies on the investment opportunities being thrown open in India. It received a $5.8 billion in bailout funds from the taxpayer, but still needs more capital to become profitable.
Swadeshi Jagran Manch has said that easing the norms for FDI in SBRT would go against the best interest of the country.
Besides, the clarification that real estate broking service will not amount to real estate business has addressed the issue being faced by such firms.
He has said that the government is taking the plea of huge loss Air India is being burdened with to justify its move, but the Centre is seeking to hide the fact that the carrier has been pushed to this situation not because of its management's failure but owing to "imposition of disastrous decisions on the company by successive governments at the Centre". Foreign investment is a major driver of economic growth and a source of non-debt finance for the economic development of the country.
In the case of medical devices, the government has permitted a wide range of items that can attract up to 100 per cent FDI via the automatic route. The Cabinet has allowed 100% FDI via automatic route in single brand retail trading and construction, while it has raised the existing limit in power exchanges and aviation sectors.
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The Union Cabinet has given its approval to a number of amendments in the FDI Policy. However, foreign investors' purchases were restricted to the secondary market only.
Mahajan particularly targeted the government's decision to relax the 30 per cent local sourcing condition for single-brand retail, saying it ran counter to the government's "Make in India" policy.
It is obvious that it is the slowing of the economy, post-demonetisation, that has prompted the government to accelerate the process of divestment and liberalise FDI norms on a large scale.
"Allowing 100 per cent FDI in single-brand retail trade will further increase the hardship of traditional retail trade sector which is the second biggest livelihood giver after agriculture and expedite the ruin of the traditional retail trade sector", Sen said.