Govt clears 23 FDI proposals worth Rs 565 cr, defers 13 others

The government has cleared 23 FDI proposals, which will bring Rs 564.80 crore into India, including Dubai-based Damas' plan for retail trading in jewellery and Danone's plans to re-enter food products space after quitting Britannia earlier this year.

A proposal by Damas LLC to set up a joint venture with Gitanjali Lifestyles for retail trading of jewelleries will bring in foreign direct investment (FDI) of Rs 180 crore, while Danone's plans for food products business do not have any definite FDI content as company for this purpose is yet to be incorporated.

However, the government, on the basis of recommendation by the Foreign Investment Promotion Board (FIPB), deferred 13 proposals which include Vijay Mallya-owned United Breweries plans for raising Rs 708 crore by issuing fully convertible equity warrants.

The proposals by G4s Corporate Services Ltd and Morgan Stanley were rejected by the government, an official release said today.

The proposed JV between Damas and Gitanjali Lifestyles will open about 100 stores in three years with an investment of over Rs 300 crore.

The JV will sell jewellery under the brands of Al Zain, Aura, Boudoor, Diabla and others.

France-based Danone will now be able to operate in businesses like biscuits, mineral water, cereals, dairy, baby food and medical nutrition products.      Danone may go it alone or operate through its existing or new JVs in these sectors.

Danone had earlier this year sold its entire stake in Britannia Industries Ltd to the Nusli Wadia Group.

Besides, Lazard Mauritius proposal to invest Rs 125 crore in the units of private equity fund -- Lazard India Growth Fund -- was also cleared by the government.

Also, US-based Lazard's proposal to venture into asset management services for a domestic venture capital fund got the government's nod.

US-based agri-processing firm Archer Daniels Midland's (ADM) proposal for setting up an Indian arm was also given a go ahead by the government.

ADM Interoceanic Ltd, Mauritius, had sought approval for acquiring the entire shareholding and control of a new company to be set up in the name of ADM Agro Industries India Pvt Ltd, which is to act as operating-cum-investing company.

A proposal by Japanese auto component maker ShinMaywa Industries Ltd to form a joint venture with Pune-based firm Kailash Vahan Udyog Ltd also received government's approval.

ShinMaywa Industries will form a JV with the Indian firm to design, manufacture, sale and provide after sales service of the Japanese firm's special purpose truck products, like tippers and garbage compactors.

Among 13 proposals deferred by the government includes plans by United Breweries Holdings to raise Rs 708 crore by issuing 63.87 lakh fully convertible equity warrants.

According to sources, the Department of Revenue (DoR) has not supported the proposal on the ground that the money sought to be raised is "primarily a loan from Nexgen Capital and Standard Chartered Bank routed through FirStart Inc as investment".

Also deferred is a proposal by Norwegian telecom firm Telenor to hike stake in its Indian telecom joint venture Unitech Wireless up to 74 per cent as the Ministry of Home Affairs has asked for more time to examine the deal.

A proposal by Quippo Telecom Infrastructure to acquire 30.64 per cent share of Wireless TT Info Services Ltd by way of purchase of equity shares from Tata Sons and Tata Teleservices was also deferred by the government after a request to this effect by the Home Ministry.