New Delhi: The government today said there was no “immediate plan” to permit foreign direct investment in the country’s coffee and rubber plantation sector.
“There is no immediate plan to allow FDI in coffee and rubber plantation. These are all speculation. Nothing on cards,” DIPP Secretary Amitabh Kant said. At present, 100 per cent foreign investment is permitted through the government approval route in the tea plantation sector. However, FDI is not allowed in any other plantation sector or activity.
Addressing a CII conference on India-China trade here Kant said, “huge trade deficit with China which is not sustainable” while adding that Chinese companies must invest in India. “India is one of the largest markets for China. Bilateral trade suffers from a huge imbalance,” he said. Kant pointed out that FDI from China into India is only USD 1.12 billion, which is only 0.44 per cent of total FDI, adding that Chinese companies must invest in setting up manufacturing facilities in India.
“We would like to provide all support to Chinese companies to invest in India,” he said. Noting that China plans to set up two industrial parks in India, he said: “More than industrial parks we would like to help, support and assist Chinese companies’ investments into India.” As per government data, India’s natural rubber import increased to 442,130 tonnes in 2014-15, the highest so far, from 3,60,263 tonnes in 2013-14 and 2,62,753 tonnes in2012-13. The production of natural rubber declined to a 12-year low at 6,45,000 tonnes in 2014-15 as against 7,74,000 tonnes in 2013-14, down 12 per cent.
To boost domestic production of the crop, the government is in the process of formulating a national rubber policy. Total rubber consumption by various industries, including tyre manufacturers, stood at 10,18,000 tonnes in 2014-15, 3.7 per cent higher than the previous year. As per estimates, the country’s coffee output is pegged at 3,31,000 tonne for 2014-15 crop year (October-September), against 3,04,500 tonne last year.
India exported coffee worth USD 803 million in 2014-15 against USD 799 million in 2013-14. In 2014-15, FDI into the country rose 27 per cent to USD 30.93 billion. To pull in foreign investments, the government has raised the FDI cap in the insurance sector and defence. It has relaxed policy in railways, construction and medical devices sectors.