Modi to review FDI policy today

Prime Minister Narendra Modi will review the foreign direct investment (FDI) policy today with a view to removing bottlenecks to overseas inflows, sources said.

At the meeting, the commerce and industry ministry will make a detailed presentation on proposed changes to streamline the FDI regime in the country.

Finance Minister Arun Jaitley, Commerce and Industry Minister Nirmala Sitharaman and Secretary, Department of Industrial Policy and Promotion (DIPP), Ramesh Abhishek will attend the meeting, sources who did not wish to be identified said.

The meeting assumes significance as the government is considering relaxing FDI norms in several sectors, including retail and construction. Also, on the table is the proposal to ease rules in print media, construction, the single brand and multi-brand retail trading.

Plans are afoot to ease the policy in the construction sector, under which an Indian company could be allowed to bring in FDI even for undeveloped plots in any project.

As per the current policy, 100 per cent FDI is allowed in the construction sector subject to various conditions.

As per rules, Indian investee company is permitted to sell only developed plots, which means plots where trunk infrastructure roads, water supply, street lighting, drainage and sewerage -- has been made available.

The sources said the government may impose certain restrictions while making changes under this provision.

The government is weighing the option of permitting overseas retailers to open stores for selling 'Made in India' products only.

Although the current FDI policy allows overseas players to hold 51 per cent stake in an Indian retail company, the BJP in its election manifesto had opposed foreign investment in the retail space.

There are also plans to permit 100 per cent foreign investment through automatic route in single brand retail to attract a larger number of global players into the sector.