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Govt expects 45% jump in FDI in 2016
30
Dec '15
The government expects FDI inflows to rise by 40-45 per cent in 2016 on the back of a series of reforms in the past year while further steps could be on anvil to attract foreign capital.

According to the latest available figure for 2015, FDI inflows during January-September period has increased by 18 per cent to $26.51 billion.

In the entire 2014, India had received FDI worth $28.78 billion as compared to $22 billion in 2013.

Amitabh Kant, Secretary in the Department of Industrial Policy and Promotion (DIPP), told a news agency that FDI would grow by 40-45 per cent in 2016 despite the global slowdown.

The sectors that have attracted maximum FDI this year include services, computer hardware and software, telecom, automobile and trading.

Singapore was the top source for FDI coming into India in 2015, followed by Mauritius, UK, Japan, the Netherlands and the US.

In a bid to streamline the FDI structure, the government this year introduced a composite foreign investment cap by clubbing all forms of overseas investments to define sectoral limits. It has also relaxed e-commerce norms for foreign companies having manufacturing facilities in India.

Kant said that the steps announced to improve ease of doing business would help India become the easiest place for investors. As part of that exercise, the government is planning to put 98 per cent of sectors, which are open to foreign investments, under the automatic route so that businessmen won't need to visit the Finance Ministry for any approval.

India's ranking in the World Bank's report on ease of doing business improved to 130th position this year from 142nd last year out of 189 countries.

As part of the reform measures, the government has hiked foreign investment caps, opened new sectors and relaxed norms for several segments.

It permitted portfolio investors to buy up to 74 per cent in local private banks, while palm, coffee and rubber plantations have been opened up for the first time.

FDI norms have also been eased in real estate, defence, civil aviation and news broadcasting sectors.

Sourcing rules for single brand retailers, particularly for high-tech, have been eased by allowing them to sell online without specific permissions. But there is no change in 51 per cent limit for multi-brand retailers like Wal-Mart.

To improve investment climate, the DIPP has taken a series of steps that include having a time line for clearance of applications, de-licensing the manufacturing of many defence products and introduction of e-Biz project for single window clearance. (SH)

Fibre2Fashion News Desk - India

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