Government Eyes Further Easing Of FDI Norms To Boost Investment

(MENAFN- KNN India) New Delhi, Feb 10 (KNN) In a bid to attract higher foreign direct investment (FDI) inflows, the government is considering further easing procedural norms in select sectors, a senior official has confirmed.

The Department for Promotion of industry and Internal Trade (DPIIT) has concluded stakeholder consultations, gathering insights fr0m government bodies, regulators, industry associations, and investment firms.

"We have completed the consultations and received various suggestions on procedural improvements. However, final decisions are yet to be made," the official stated, without disclosing specific sectors under review.

Among the key issues discussed were allowing e-commerce platforms to receive FDI under an inventory-based model for export purposes, refining press note 3 by defining beneficial ownership, and revising policies for single-brand retail trading.

Notably, press note 3 mandates government approval for FDI fr0m nations sharing land borders with India.

India's cumulative FDI inflows surpassed the USD 1 trillion mark between April 2000 and September 2024, with sectors like services, IT, telecommunications, construction, and pharmaceuticals leading investments. The country saw a 45 per cent increase in FDI in the first half of the current fiscal year, totalling USD 29.79 billion.

Experts advocate for structural reforms, including time-bound FDI approvals, clear investment guidelines, and a seamless single-window clearance system to enhance India's investment climate.

"India's FDI is predominantly into brownfield projects, but greenfield expansion holds significant potential. Streamlining land acquisition, dispute resolution, and infrastructure development will be crucial," said Rumki Majumdar, Economist at Deloitte India.

Legal experts also urge transparency in FDI approvals. "Bureaucratic delays, often extending beyond nine months, deter investors. Clear guidelines and 'deemed approvals'-where unprocessed applications are automatically sanctioned-can eliminate uncertainties," noted Rudra Kumar Pandey, Partner at Shardul Amarchand Mangaldas.

As India continues refining its FDI policies, clearer regulations and swifter approvals could unlock its full investment potential, reinforcing its position as a global investment hub.

(KNN Bureau)

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