100% FDI approved in Telecom, 49% FDI in Defence
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.
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.