 |
|
Indian Seamless
to setup plant in Australia
MORE
[+] |
|
| |
|
| |
03. INVESTMENT UPDATE |
| |
|
| |
 |
| |
|
| |
FDI
ceiling in Telecom Sector increased from 49-74 percent |
| |
The
Government has decided to enhance the Foreign Direct Investment ceiling
from 49 per cent to 74 per cent in certain telecom services [such
as Basic, Cellular, Unified Access Services, National/International
Long Distance, V-Sat, Public Mobile Radio Trunked Services (PMRTS),
Global Mobile Personal Communications Services (GMPCS) and other value
added services], subject to the following conditions: - |
| |
 |
|
The
total composite foreign holding including but not limited
to investments by Foreign Institutional Investors (FIIs),
Non-resident Indians (NRIs), Foreign Currency Convertible
Bonds (FCCBs), American Depository Receipts (ADRs), Global
Depository Receipts (GDRs), convertible preference shares,
proportionate foreign investment in Indian promoters/investment
companies including their holding companies, etc., herein
after referred as FDI, will not exceed 74 per cent. Thus,
74 per cent foreign investment can be made directly or
indirectly in the operating company or through a holding
company. Hence, the remaining 26 per cent will be owned
by resident Indian citizens or an Indian Company (i.e.
foreign direct investment does not exceed 49 percent and
the management is with the Indian owners).
It is clarified that proportionate foreign component of
such an Indian Company will also be counted towards the
ceiling of 74%. However, foreign component in the total
holding of Indian |
public sector banks and Indian public
sector financial institutions will be treated as 'Indian' holding.
The licensee will be required to disclose the status of such
foreign holding and certify that the foreign investment is within
the ceiling of 74% on a half yearly basis.
The majority Directors on the Board including Chairman, Managing
Director and Chief Executive Officer (CEO) shall be resident
Indian citizens, enforced through licence agreement. The appointment
to these positions from among resident Indian citizens shall
be made in consultation with serious Indian investors. The Share
Holder Agreements (SHA) shall specifically incorporate the condition
that majority directors on the Board including Chairman, Managing
Director and CEO shall be resident Indian citizens and shall
also envisage the conditions of adherence to Licence Agreement.
FDI upto 49 per cent will continue to be on automatic route.
Foreign Investment Promotion Board (FIPB) approval shall be
required for FDI in the licensee company/Indian promoters/investment
companies including their holding companies if it has a bearing
on the overall ceiling of 74 per cent. While approving the investment
proposals, FIPB shall take note that investment is not coming
from unfriendly countries.
The investment approval by FIPB shall envisage the conditionality
that Company would adhere to licence Agreement. FDI shall be
subject to laws of India and not the laws of the foreign country/countries
|
|
| |
|
| |
|
| |
| |
|
| |
Foreign investment in
IT, telecom sector to touch US$ 22 million |
| |
|
| |
With foreign investment
cap being raised to 74 percent from 49 percent, according to
industry estimates the foreign investment in the IT and telecom
sector is to double to US$ 22 million this year. |
| |
|
| |
European companies
like Vodafone and Telecom Italia as well as Korean, Japanese
and Malaysian telecom majors are already scouting in India.
And a majority of Indian telecom firms are also looking for
funds to expand. The major deals struck last year include Vodafone
picking up a 10 percent stake in telecom major Bharti for $1.5
billion and Hutch Essar's acquisition of BPL's mobile business.
Virtually every big handset manufacturer |
|
announced
manufacturing facilities in India in 2005 and few even kick-started
it. Analysts expect this to help lower prices of phones and
tune them closer to Indian requirements including language.
Nokia has more than half of the estimated market and is investing
$100-$150 million in its plant. Motorola, the world's second
largest mobile phone maker, with a marketshare close to 10%
in India has said it will start assembling |
|
ihandsets
in the country by December and that it is considering full-scale
manufacturing later. LG Electronics, aiming to sell phones priced
in the low- to mid-range, has invested $60 million in a plant
to make 20 million GSM and CDMA phones a year in India by 2010.
Of the expected 810 million global mobile phone sales this year,
India is expected to account for about 34 million. |
|
| |
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| |
New SEZ norms to focus on gems and jewellery
The government is likely to announce
the new Special Economic Zone (SEZ) rules, which will include some
far reaching changes and exemptions.
"India might be looking at an export opportunity of upto $300
billion in the next 2-3 years in the gems and jewellery space and
we cannot let go of the opportunity. In the SEZ rules that are underway,
there may be an
exemption of 100 per cent income tax in the first five years, 50
per cent in the next five and if the profits are being reinvested,
then there could be a 50 per cent reduction in the taxes being charged,"
said LB Singhal, director, Gems & Jewellery Export Promotion
Council, at a seminar organised by the CII and the Delhi
State Industrial Development corporation (DSIDC).Gems & Jewellery
Export Promotion Council, under the aegis of Ministry of Commerce
and Industry, is deliberating the rules following the SEZ Act passed
last October. |
|
