The Union Finance Minister, Shri P. Chidambaram with the Chiefs of Public Sector Banks at a meeting, in New Delhi on November 04, 2008. The Minister of State for Finance and Parliamentary Affairs, Shri Pawan Kumar Bansal is also seen.

A proposal from ILFS-ORIX Trust Company Ltd to bring in foreign direct investment (FDI) worth Rs 400 crore from Foreign Offshore Fund by issuing units of the Trust was among the 40 FDI proposals approved by the Government on Friday. A total of 40 proposals involving FDI worth Rs 1,498.51 crore has been cleared by the Finance Minister, Mr P. Chidambaram, following recommendations from the Foreign Investment Promotion Board (FIPB), an official release said. Pepsico’s long-pending proposal to delete a disinvestment condition in

its original approval and increase approved equitywas recommended for the consideration of the Cabinet Committee on Economic Affairs (CCEA) as the initial approval was given by the Cabinet Committee on Finance and Investments (CCFI) which later got converted into CCEA. A proposal from Asset Reconstruction Company (India) Ltd to increase foreign equity participation in the company from the present 5 per cent to 14.66 per cent by inducting a new foreign collaborator and involving FDI worth Rs 272.86 crore was also cleared by the Minister. Large amounts The Finance Minister also gave the go ahead to proposals for conversion of operating companies into holding companies for Louis Vuitton Malletier (FDI Rs 150 crore), U DORI Engineering Works Corporation (FDI Rs 125 crore) and Forum Ventures Pvt Ltd (Rs 99.97 core).

Two large FDI proposals in excess of Rs 600 core each were sent to the CCEA for approval. The proposal from TPG India Investment Inc, Mauritius, to bring in FDI worth Rs 805.61 crore and by issue of warrants was referred to the CCEA. Similarly Suzlon Energy’s plan to bring in FDI worth Rs 1,800 crore for making downstream investments too was sent to the CCEA for final approval.

Source: The Hindu Business Line

Extraordinary situations require extraordinary actions. This appears to be the latest mantra for policymakers and government functionaries. Hectic discussions are on in North Block and Udyog Bhawan to liberalise FDI norms and relax existing regulations in a bid to infuse more investments into the Indian economy. The Department of Industrial Policy and Promotion (DIPP) and the finance ministry are working together to do away with the cap on FDI in single-brand retail and allow up to 100% foreign investments.

As of now, the policy permits foreign investments up to 51% in single-brand retail. This apart, consultations are on to examine the possibilities of allowing 51% FDI in the multi-brand retail - hitherto an untouchable area for the government. The government's recent thinking on easing FDI restrictions comes on the back of the current liquidity crisis which has been compounded with a significant outflow of foreign investments by FIIs. Despite the present difficulties, India is expected to sustain an economic growth of 7%-plus in coming years. The government feels that policy measures are needed to prop up India as an investment destination.
They are also working on increasing FDI in asset reconstruction companies (ARCs) beyond the existing 49%. And it is not only about FDI caps. The government is also keen to do away with some of the policy hurdles that deterred further investments by foreign companies. The government is willing to allow more ARCs to conduct business in India as it would create a buffer for the country's financial system.

One such policy irritant which has often led to delays relates to Press Note 1. The government is considering relaxation of PN1 rules which requires a foreign company to obtain a no-objection certificate(NOC) from its existing JV partner before setting up a new venture in the same line of business in India. The government is also looking at allowing foreign companies to buy shares from the stock market. As of now, only FIIs are allowed to buy shares from the secondary market through stock exchange deals.

The move would step up capital flows, check the stock market slide and arrest depreciation of the rupee. Highly-placed sources said the PM has been personally monitoring the current economic scenario and is learnt to have several rounds of meetings with his cabinet colleagues.

Louis Vuitton Malletier (FDI Rs 150 crore), U DORI Engineering Works Corporation (FDI Rs 125 crore) and Forum Ventures Pvt Ltd (Rs 99.97 core). Two large FDI proposals in excess of Rs 600 core each were sent to the CCEA for approval. The proposal from TPG India Investment Inc, Mauritius, to bring in FDI worth Rs 805.61 crore and by issue of warrants was referred to the CCEA. Similarly Suzlon Energy’s plan to bring in FDI worth Rs 1,800 crore for making downstream investments too was sent to the CCEA for final approval.

FDI INFLOWS UP BY 259% IN SEPTEMBER 2008
The Foreign Direct Investment (FDI) equity inflows in the month of September, 2008 were US $ 2.56 billion. This represents a growth of 259% over the same month in the previous year (during September, 2007, the FDI equity inflows were US $ 713 million). The FDI equity inflows during April-September 2008 have been US $ 17.21 billion. This represents a growth of 137% over the previous year (FDI equity inflows during April-September 2007 were US $ 7.25 billion). The sectors attracting the highest FDI equity inflows during April to August, 2008 have been the services sector (US $ 2.34 billion), construction activities including roads and highways (US $ 1.64 billion), housing and real estate (US $ 1.62 billion) and computer hardware and software (US $ 1.36 billion). The top investing countries in terms of FDI equity inflows during April to August, 2008 have been Mauritius (US $ 5.27 billion), Singapore (US $ 1.72 billion), USA (US $ 1.15 billlion) and Netherlands .

Source: The Economic Times

The Prime Minister, Dr. Manmohan Singh addressing the First India-Africa Forum Summit, in New Delhi

Prime Minister Dr. Manmohan Singh announced India’s Duty Free Tariff Preference (DFTP) Scheme for the Least Developed Countries (LDCs) on the occasion of the India-Africa Forum Summit of African Heads of States/Governments and their official representatives in New Delhi on April 8, 2008. The DFTP Scheme grants duty free access on 94% of India’s total tariff lines to be implemented over a period of five years. Specifically it will provide preferential market access on tariff lines that comprise 92.5% of global exports of all LDCs.

Products of immediate interest to Africa which are covered include cotton, cocoa, aluminium ores, copper ores, cashew nuts, cane-sugar, ready-made garments, fish fillets and non-industrial diamonds. The Scheme is open to all 49 LDC members including 33 LDCs in Africa. The Scheme provides that in order to avail benefits under this Scheme, individual LDC members submit a Letter of Intent to the Government of India. The Scheme further provides that in order to enjoy tariff preference, the beneficiary country submits a Certificate of Origin along with the consignment. The Department of Commerce has received Letters of Intent from 10 LDCs, out of which Customs Notifications No. 96 and No. 99 have already been issued on 13.8.2008 and 28.8.2008 in respect of 7 LDCs, namely Cambodia, Tanzania, Ethiopia, Mozambique, Samoa, Malawi and Lao PDR.

The Letters of I DELHI-MUMBAI INDUSTRIAL CORRIDOR The Government of India accorded ‘in-principle’ approval to the Delhi-Mumbai Industrial Corridor (DMIC) project outline in August, 2007 which envisages inter-alia Project Development Work for implementation through Public Private Partnership of world class infrastructure in the region including road transport connectivity. A Central Special Purpose Vehicle named DMIC Development Corporation (DMICDC) has been incorporated in January 2008 and the corporation has appointed an International consultant for preparation of Detailed Perspective Plan for overall DMIC Region with pre-feasibility studies which includes road linkages to be developed in the region. M/s Gujarat Infrastructure Development Board (GIDB), a Government of Gujarat entity has forwarded a proposal for augmentation of roads in Gujarat in the Delhi Mumbai Industrial Corridor. DMICDC has also entered into a Memorandum of Understanding with GIDB in July 2008 to facilitate development of select early bird projects.