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Wednesday, June 19, 2013

Mayaram panel recommends full foreign ownership in telecom & aviation, 74% FDI in multi-brand

NEW DELHI: A government panel has recommended a dramatic liberalisation of India's foreign direct investment regime, including raising the FDI limit to 74% in multi-brand retail and allowing complete foreign ownership of telecom and aviation companies.

It has also batted for raising or doing away with FDI caps in a number of sectors, including non-scheduled air transport, ground handling at airports, satellites, private security agencies and Internet Service Providers (ISPs) to attract capital flows that are needed to finance the current account deficit and bolster the rupee, which hit a new low on Tuesday.

"We have given our recommendations to the finance minister. He has forwarded them to the Department of Industrial Policy & Promotion (DIPP)," department of economic affairs Secretary Arvind Mayaram, who headed the panel, told reporters on Tuesday. He did not provide details of the report's contents.

The DIPP, the administrative ministry in charge of FDI policy, will now have to implement the Mayaram Committee report. Key ministers, notably Finance Minister P Chidambaram and Commerce Minister Anand Sharma, are expected to meet in the first week of July to finalise the plan.

Manmohan has Endorsed Plan

After clearance from key ministers, the proposal will then be brought before the Cabinet. Chidambaram has already briefed Prime Minister Manmohan Singh on the plans to further liberalise the foreign direct investment regime and Singh has endorsed the plan.

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