Cabinet gives ex-post-facto nod to FDI reforms in 15 sectors

New Delhi: Cabinet Wednesday gave ex-post-facto approval to the easing of foreign direct investment (FDI) policy in 15 sectors that was approved by the Prime Minister Narendra Modi last month.

The Cabinet, headed by Modi, approved the relaxation in FDI policy for 15 sectors including real estate, defence, civil aviation and news broadcasting, official sources said.

On November 10, Modi had in the immediate aftermath of BJP's rout in Bihar assembly polls, approved a raft of reforms aimed at boosting investor confidence and drumming up FDI for faster growth.

While restrictions in the construction sector were freed up by allowing overseas investors to exit and repatriate investment even before project completion, foreign direct investment (FDI) up to 49 percent stake in defence firms and regional airlines has been allowed without government nod.

As part of the reform exercise, the government had allowed 100 percent FDI in cable and direct-to-home TV operators, duty free shops and investment through automatic route in limited liability partnerships.

It also permitted portfolio investors to buy up to 74 percent in local private banks, with full fungibility, while palm, coffee and rubber plantations have been opened up for the first time.

Rules for sourcing for single-brand retailers particularly for high-tech have been eased by allowing them to sell online without specific permissions. But there is no change in 51 percent limit for retailers like Wal-Mart in multi-brand retailing.

The government also raised financial power of the Foreign Investment Promotion Board (FIPB) to give single window clearance for investment projects of up to Rs 5,000 crore from Rs 3,000 crore.

All the relaxations were approved by the Cabinet at its meeting here this evening, sources said.