FDI push for economy: #Cabinet allows 100% foreign investment in single-brand retail

In a move aimed to provide ease of doing business, the Modi government on Wednesday approved 100 per cent foreign direct investment (FDI) in single-brand retail, and also eased investment norms across sectors including aviation and construction, among others.

The government also approved changes in FDI norms to allow foreign airlines to own 49 per cent in Air India under the approval route, setting two conditions: That foreign investment, including that of foreign airline(s), shall not exceed 49 per cent either directly or indirectly and “substantial ownership and effective control of Air India shall continue to be vested in Indian National”, an official statement said, The Hindu reported.

Greater FDI inflows would help boost investment, income and employment in the nation. However, 100 per cent FDI in single-brand retail has been opposed by the Confederation of All India Traders on the grounds that it will facilitate easy entry of MNCs in the retail trade and also violate the poll promise of the BJP, Outlook reported.

Currently, FDI up to 49 per cent is allowed under automatic route for single-brand retail.

Retail sector stocks traded mixed in the wake of the move, that would also open the economy further to global players.