Modi says India now world's most open economy; approves 100 per cent FDI in defence, aviation

Discussion in 'Economy & Infrastructure' started by Mikesingh, Jun 20, 2016.

  1. Mikesingh

    Mikesingh Senior Member Senior Member

    Joined:
    Sep 7, 2015
    Messages:
    1,061
    Likes Received:
    1,331
    With the objective of providing major impetus to employment and job creation in India, the government on Monday made changes to the FDI policy at a meeting chaired by Prime Minister Narendra Modi. According to a release by the government, this is the second major reform after the last radical changes announced in November 2015.

    Most of the sectors would be under automatic approval route, except a small negative list. According to the government release, Monday’s amendments to the FDI Policy are meant to liberalise and simplify the FDI policy so as to provide ease of doing business in the country leading to larger FDI inflows contributing to growth of investment, incomes and employment.
    Here’s a look at the changes:

    Foreign Investment in Defence Sector up to 100 per cent

    The present FDI regime permits 49 per cent FDI participation in the equity of a company under automatic route. FDI above 49 per cent is permitted through government approval on case to case basis, wherever it is likely to result in access to modern and ‘state-of-art’ technology in the country. In this regard, the following changes have inter-alia been brought in the FDI policy on this sector:

    * Foreign investment beyond 49 per cent has now been permitted through government approval route, in cases resulting in access to modern technology in the country or for other reasons to be recorded. The condition of access to ‘state-of-art’ technology in the country has been done away with.

    * FDI limit for defence sector has also been made applicable to Manufacturing of Small Arms and Ammunitions covered under Arms Act 1959.

    Pharmaceutical


    The extant FDI policy on pharmaceutical sector provides for 100 per cent FDI under automatic route in greenfield pharma and FDI up to 100 per cent under government approval in brownfield pharma. With the objective of promoting the development of this sector, it has been decided to permit up to 74 per cent FDI under automatic route in brownfield pharmaceuticals and government approval route beyond 74 per cent will continue.

    Civil Aviation Sector


    The extant FDI policy on Airports permits 100 per cent FDI under automatic route in Greenfield Projects and 74 per cent FDI in Brownfield Projects under automatic route. FDI beyond 74 per cent for Brownfield Projects is under government route.

    With a view to aid in modernization of the existing airports to establish a high standard and help ease the pressure on the existing airports, it has been decided to permit 100 per cent FDI under automatic route in Brownfield Airport projects.

    As per the present FDI policy, foreign investment up to 49 per cent is allowed under automatic route in Scheduled Air Transport Service/ Domestic Scheduled Passenger Airline and regional Air Transport Service.

    It has now been decided to raise this limit to 100 per cent, with FDI up to 49 per cent permitted under automatic route and FDI beyond 49 per cent through Government approval.

    For NRIs, 100 per cent FDI will continue to be allowed under automatic route. However, foreign airlines would continue to be allowed to invest in capital of Indian companies operating scheduled and non-scheduled air-transport services up to the limit of 49 per cent of their paid up capital and subject to the laid down conditions in the existing policy.

    Entry Routes in Broadcasting Carriage Services

    FDI policy on broadcasting carriage services has also been amended by the government. New sectoral caps and entry routes are as follows:

    Teleports (setting up of up-linking HUBs/Teleports); Direct to Home (DTH); Cable Networks (Multi System operators (MSOs) operating at National or State or District level and undertaking upgradation of networks towards digitalization and addressability); Mobile TV; Headend-in-the Sky Broadcasting Service (HITS); Cable Networks will all be permitted 100 per cent FDI.

    http://indianexpress.com/article/bu...t-opens-up-defence-civil-aviation-and-pharma/

    Big bang reforms at last! But why has Modi woken up after 2 long years in office? Otherwise by now, a million jobs would have been created by the manufacturing sector alone knocking the wind out of Congress' sails.

     
    Last edited: Jun 20, 2016
    hit&run likes this.
  2.  
  3. Screambowl

    Screambowl Senior Member Senior Member

    Joined:
    Jan 1, 2015
    Messages:
    4,618
    Likes Received:
    3,226
    Location:
    N/A


    I think antony has a point!!!
     
    Peter likes this.
  4. Bharat Ek Khoj

    Bharat Ek Khoj Senior Member Senior Member

    Joined:
    Apr 21, 2016
    Messages:
    1,304
    Likes Received:
    1,177
    Does any other country has such open economy ?
     
  5. Bahamut

    Bahamut Senior Member Senior Member

    Joined:
    Oct 31, 2015
    Messages:
    1,821
    Likes Received:
    1,327
    Location:
    somewhere in space time
    Raising FDI in pharmacies to 100% will also help, along with a nice infrastructure project for new highspeed rail,highway,airport and port. Also increase internet speed will help IT . Lets hope for more reforms
     
    Indx TechStyle likes this.
  6. indiatester

    indiatester Regular Member

    Joined:
    Jul 4, 2013
    Messages:
    545
    Likes Received:
    460
    Location:
    Bangalore
    How so?
    China has FDI is quite a few areas, we don't see them having a "dependent" foreign policy.
     
  7. Screambowl

    Screambowl Senior Member Senior Member

    Joined:
    Jan 1, 2015
    Messages:
    4,618
    Likes Received:
    3,226
    Location:
    N/A
    may be he was talking about defence sector. Well I have no idea..
     
    indiatester likes this.
  8. Gessler

    Gessler Regular Member

    Joined:
    Jan 10, 2016
    Messages:
    821
    Likes Received:
    1,389
    Location:
    Vizag, India
    It's good that these developments are happening atleast before all foreign defence conglomerates are banned in India.
     
    LETHALFORCE likes this.
  9. Peter

    Peter Senior Member Senior Member

    Joined:
    Mar 3, 2014
    Messages:
    2,211
    Likes Received:
    1,127
    Location:
    Kolkata
    Wrong move. Modiji is turning from an ordinary US lackey to a complete puppet. Even long time US supporters like me are losing sleep over his lap dog behaviour to US president Obama.
     
    OrangeFlorian likes this.
  10. Peter

    Peter Senior Member Senior Member

    Joined:
    Mar 3, 2014
    Messages:
    2,211
    Likes Received:
    1,127
    Location:
    Kolkata
    Some of the comments from the original article by The Indian Express.


    Bijan Mohanty

    Acche Din for Fund raising by BJP. Who bothers for national interest ? Tell " BHARAT MATA KI JAY" and you are a nationalist as per BJP and then indulge in anything .


    Venki

    I am not sure whether this decision was thought through. To me it appears a sign of desperation.It is not likely to attract significant investments for 'Make in India'. More likely, it will spur high-end retail activity and push up commercial property rates and provide low-end jobs. Will it provide employment to the highly-skilled? Unlikely. In any case, we will see the effect (or consequences) only a few years down the line. One big question remains unanswered - why are our industrialists so reluctant to put their money where their mouths are?

    Am A

    "The govt is selling this Nation to Foreigners"

    Nope I am not saying this... this is actually the stand that was taken by Modi/BJP on FDI when it was in opposition!!!


    Pre Sphinx

    Total sell out by modi sarkar ,the so called nationalist r now selling our beloved country.i agree we should have fdi but not like this ki pura bech hi do country ko.


    gopal

    Why BJP opposed to FDI when UPA was in power. BJP as stop the development of country from last 4 years if they have allowed Sri Manmohan Singh today India would have been better placed. Modi Sarkar is not selling the country to USA

    Hitesh

    i never though Mr. Modi would turn out to be such a ruthless leader. he faked Indians and we are hurt. we miss thought that India is going on world level politics and other matters.




    Some are in agreement though.


    Vishnu V

    Indians have experimented with the leftist and centre-left socialistic view that business and foreign investors are looters.

    It should be recalled that these feel good policies only gave rise to worst looters- only this time desis. The list is so long, I will spare the pain. From 1980's even China- the darling of Communist dreams- have realized its mistake and allowed foreign investors. Not to mention the country is in trouble today in sectors were it artificially got involved with bogus loans.

    The Communists who always accused BJP's efforts to bring FDI in 99-04 as selling out nation, in their last phase in WB were so desperate to generate some employment that they brought Selim group from Indonesia.

    So long as Government's intention is good and it does let FDI go awry like 1997 Asian crisis- at least we, the youth in this country should accept the changed realities of a modern world - that businessmen are not inherently bad, it is discretionary powered governments that foster corruption.
     
  11. ezsasa

    ezsasa Senior Member Senior Member

    Joined:
    Jul 12, 2014
    Messages:
    3,504
    Likes Received:
    3,039
    Location:
    Hyderabad, Andhra Pradesh, India
    In my case it is not modi we need to worry about, more about who is going to come next. Current reform trend has to continue for atleast 10 more years, no matter who the PM is.

    As far as modi is concerned, no risk no reward.
     
    Abhijat and OneGrimPilgrim like this.
  12. OneGrimPilgrim

    OneGrimPilgrim Senior Member Senior Member

    Joined:
    May 18, 2015
    Messages:
    3,345
    Likes Received:
    3,419
    Location:
    whr invaders hv been eulogised, heroes binned!!
    looks like we ourselves have still not learnt our lessons. don't rely on half-baked news the media is habitual to publish. lets wait for the fine-print.
    the investments above 49% are still on 'Government Approval required' route. the only change is that for such approvals, they have replaced the condition of bringing in 'State-of-the-Art Technology' to 'Modern Technology'. it looks more like an 'ease of decision-making' for the GoI rather than opening the floodgates completely. basically the Govt can define what is state-of-the-art with no objective standards (which are impossible, as it keeps changing). gives them complete control in allowing 100% FDI in defense. So, no automatic approval, more like a case-by-case.
    however hopefully this is not Modi's Vajpayee moment (the FDI in media).
     
    VIP, alphacentury, rock127 and 2 others like this.
  13. OneGrimPilgrim

    OneGrimPilgrim Senior Member Senior Member

    Joined:
    May 18, 2015
    Messages:
    3,345
    Likes Received:
    3,419
    Location:
    whr invaders hv been eulogised, heroes binned!!
    true. even in this case of FDI, the first some years are going to be mostly only signing this-and-that agreement; the results will show later (provided the pace is kept).
     
  14. OneGrimPilgrim

    OneGrimPilgrim Senior Member Senior Member

    Joined:
    May 18, 2015
    Messages:
    3,345
    Likes Received:
    3,419
    Location:
    whr invaders hv been eulogised, heroes binned!!
    this commentator doesn't even try to be crypto-asinine! who was that person who used to get arms-deals done abroad for 'cuts' that would go towards party-funding?!
    the present dispensation may've been showing every bonhomie with US but they haven't purchased any $hit weaponry from them! and are kicking on the [email protected] of devious US NGOs & EJ fronts like the USCIRF, plus plugging their money-channels & now kicked out their MMS 2.0, aka R3. no wonder c-sys pets & their phoren paymasters have been bawling all through!


    This is a very big deal for a nation that was seen as a socialistic lean.
     
    LETHALFORCE and Mikesingh like this.
  15. Kshatriya87

    Kshatriya87 Senior Member Senior Member

    Joined:
    Feb 12, 2014
    Messages:
    4,717
    Likes Received:
    3,155
    Location:
    Mumbai
    Don't like this move. Anything more than 49% is not good for India. This makes our defense production dependent on foreign companies which are in turn dependent on their respective nations. In case of a war with that country or their ally, these countries can force foreign industries in India to shut down. This will in turn effect our fighting capacity.
     
    LETHALFORCE likes this.
  16. Mikesingh

    Mikesingh Senior Member Senior Member

    Joined:
    Sep 7, 2015
    Messages:
    1,061
    Likes Received:
    1,331
    Here's what some 'economist' clown commented...

    "Total sell out by modi sarkar ,the so called nationalist r now selling our beloved country.i agree we should have fdi but not like this ki pura bech hi do country ko."


    Really? Do morons like him know that India remains the world’s largest weapons importer over a five-year period. Last year alone, India imported arms and equipment worth $6 billion or nearly Rs 40,000 crores. 100% FDI would mean manufacturing in India itself at far lesser cost. This would also create hundreds of thousands of jobs as well as money made from exports like in the case of cars.

    There would also be transfer of modern technology that would help indigenous production as well as spinoffs.

    100% FDI in food products would result in food items getting cheaper as there would be efficient logistics, warehousing and direct procurement of farm produce from the farmers without going through middlemen and coteries that now control supply. The quality would also be better.

    Some people love to wallow in the status quo. Change is anathema to them. Do these self styled 'experts' have any better ideas for generating employment in India? All this talk of a 'sell out' to the US is rubbish because FDIs will not only come from the US but from Europe, the Middle East and the Asia Pacific regions.

    Thank the Lord Almighty that these communists aren't ruling the country.
     
    Last edited: Jun 21, 2016
  17. ezsasa

    ezsasa Senior Member Senior Member

    Joined:
    Jul 12, 2014
    Messages:
    3,504
    Likes Received:
    3,039
    Location:
    Hyderabad, Andhra Pradesh, India
    It's easy to say "No"..
    Can you think of better alternatives, which have a positive impact in a fixed timeframe of 10 years?
     
  18. LETHALFORCE

    LETHALFORCE Moderator Moderator

    Joined:
    Feb 16, 2009
    Messages:
    20,536
    Likes Received:
    6,537
    100 percent fdi in defense should be reevaluated imo


    Sent from my iPhone using Tapatalk
     
    Peter likes this.
  19. Peter

    Peter Senior Member Senior Member

    Joined:
    Mar 3, 2014
    Messages:
    2,211
    Likes Received:
    1,127
    Location:
    Kolkata
    By Markandey Katju.

    This is what the BJP said in opposition. Hari Om !

    [​IMG]
     
    sayareakd likes this.
  20. ezsasa

    ezsasa Senior Member Senior Member

    Joined:
    Jul 12, 2014
    Messages:
    3,504
    Likes Received:
    3,039
    Location:
    Hyderabad, Andhra Pradesh, India
    Difference between then and now is policy clarity, and intent to move towards increase in manufacturing economy. Even I was against FDI then ..

    My original question still remains...
     
    OneGrimPilgrim likes this.
  21. OneGrimPilgrim

    OneGrimPilgrim Senior Member Senior Member

    Joined:
    May 18, 2015
    Messages:
    3,345
    Likes Received:
    3,419
    Location:
    whr invaders hv been eulogised, heroes binned!!
    could you pls elucidate a bit on the underlined part?
     

Share This Page