Com & Ind Min prescribes format for filing FIPB applications

Seeking to expedite clearances for foreign investment proposals, the Commerce and Industry Ministry has prescribed a format for submitting applications before the Foreign Investment Promotion Board (FIPB).

Under the format, a foreign investor will be required to provide separate details about the joint venture partner.

Foreign single and multi-brand retailers will have to present documents to show that the brand which they propose to sell in India is an international brand.

Besides, the global retailer would also have to give diagrammatic representation of flow of funds into the joint venture indicating the business structure.

Other information which the foreign retail player will have to provide includes the status compliance of conditions under the FDI policy; list of countries where the brand is being sold internationally; existing activities and the existing capital structure of the Indian joint venture partner company.

"In order to help us serve you better and expeditiously, all applicants filing fresh proposals for consideration by FIPB are requested to ensure that (all the relevant) information/documents are available in their application form," the Department Of Industrial Policy & Promotions (DIPP) notice said.

Although the UPA government has permitted 51% FDI in the multi-brand retail, the BJP-led NDA government, which is in office, has been opposing the policy. Till now, only UK-based Tesco's proposal has been approved by the government.

On the other hand, the government permits 100% foreign direct investment (FDI) in single brand retail sector.

The government had allowed Swedish furniture major IKEA to invest Rs 10,500 crore in FDI in India for setting up single brand retail stores to sell mostly home furnishing items. Proposals of several other players, including Pavers England and sportswear giant Decathlon, have also been approved.

Foreign direct investment in India grew by only 8% to USD 24.29 billion in 2013-14.

The government is taking several steps to boost FDI in the country. It has recently de-licensed several defence products for private players, besides hiking the FDI cap to 49% in the sensitive sector.

The government has also proposed to increase the FDI limit in insurance sector to 49%.