Govt eases fdi norms for 15 sectors in big reforms push

1. Govt eases FDI norms for 15
sectors in big reforms push

2. Contd…
The government on Tuesday eased foreign direct investment (FDI) norms for
15 sectors — including defence, broadcasting, construction and retail trade
— suggesting a determined drive to push the stuttering economic reforms
programme despite the BJP’s stunning defeat in the Bihar election.
The party’s bruising defeat sparked concerns the government may struggle
to push through key reforms that have run into political opposition in
Parliament, but the decision to lift overseas investment ceilings is an
apparent move to turn India into a preferred destination for foreign
investors.
The move comes days before Prime Minister Narendra Modi leaves for the
United Kingdom for a visit in which deals worth nearly 10 billion pounds are
expected to be signed followed by the G-20 summit in Turkey.

3. Contd…
“This exercise ... is intended on the one hand to further open up sectors for more
foreign investments in the country and also to make it easy to invest in India,” the
commerce ministry said in a statement.
Prime Minister Narendra Modi said the decision to ease FDI norms in 15 sectors
demonstrates the government’s “unequivocal and unwavering” commitment to
development and reforms. “Today’ s F DI related reforms will touch 15 sectors&
benefit youth. Govt’s commitment to development & reforms is unequivocal &
unwavering,” Modi tweeted soon after the government made the announcement.
“Today’ s reforms are another example of emphasis on Minimum Government,
Maximum Governance. They will ease, rationalise & simplify processes,” he said in
another tweet.
“India is unstoppable on the path of economic progress. Govt. wants the world to
see the tremendous opportunities India offers.”

4. Contd…
The government also eased norms to spur growth in the booming e-commerce
space, and relaxed restrictive “local sourcing” conditions for single-brand retailers,
a move that will likely aid companies such as Swedish furniture maker IKEA’s plans
to set up operations in India.
In defence production, the government has now allowed companies to raise
foreign ownership up to 49% without prior government approval, in line with the
aim to turn India into a manufacturing power house through the government’s
Make in India initiative.
The government also raised the foreign investment ceiling in news broadcasting to
49% from 26% and up to 100% in the non-news broadcasting. Foreign investment
nor ms have also been eased for the construction sector to enable companies to
sell equity to investors in different phases of a project, a sign that the government
wants more funds to come into India’s cashstarved infrastructure sector to build
roads and ports.

5. Contd…
“The last few months growth in India is being driven by public investment,
some private investment and increased foreign direct investment,” said
finance minister Arun Jaitley.
The revamped FDI norms come less than two months after Modi hard sold
the India growth story on his second visit to the US and at a time when many
global companies are seeking an alternative to China as costs and risks there
rise.
“The crux of these reforms is to further ease, rationalise and simplify the
process of foreign investments into the country and to put more and more
FDI proposals on automatic route instead of government route where the
time and energy of the investors are wasted,” the government said in a
statement.

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