Removal of FDI cap up to 49 pc to encourage investments

FPJ BureauUpdated: Sunday, June 02, 2019, 08:30 AM IST
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New Delhi Industry ministrys proposal to do away with foreign direct investment caps below 49 per cent in all sectors will bring clarity in the FDI policy regime, besides encouraging investments, say experts.

Making a case for removal of FDI caps below 49 per cent, the Department of Industrial Policy and Promotion ( DIPP) has said in a discussion paper that the limits provide opportunity for arbitrage to unscrupulous Indian partners at the cost of consumers.

These FDI limits are artificial and often breached through complex web of subsidiaries. We had enough experience of FDI in the country. Time has come to open most of the sectors specially multibrand retail and defence,said Diljeet Titus, senior partner of law firm Titus & Co. Moreover, he added, From the legal point of view, it doesnt matter whether the equity holding is 26 per cent or 49 per cent.

In both cases, the investor will exercise the same control.

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