With just a few months left to the 2014 general elections, the UPA Government has come up with major reforms by allowing 100% FDI in the ailing Telecom sector and raising the FDI limit in Defence to 49% from 26%. The FDI limit in Telecom has been 74% so far. The 100 per cent FDI will allow major foreign players to target the Indian market, which is considered good for the employment sector as well as the mobile phone users.
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The government, however, did not increase the FDI limit in Petroleum (49%), but gave a major boost t the Insurance sector, by raising the FDI limit from 26% to 49%. While allowing 49% FDI in Defence, the government has made it clear that the new policy will be applied selectively with the focus on acquiring state-of-the-art technology. Asset Construction companies will get 100 per cent FDI through automatic route. Credit Information companies will have 74% FDI through automatic route.
The FDI in Power Exchange, Commodity Exchange and Stock Exchange has been increased to 49% through automatic route. In Courier Services, 100% FDI has been approved through automatic route. The FDI decisions taken by the government are set to boost the declining Rupee against USD and give a new dimension to the Indian Economy.
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