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Modi government blows life in dying Air India with 49% FDI

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A major decision has been taken to revive the dying government venture Air India. Under the new amendments, FDI up to 49% has been allowed under the approval route.  

 

New Delhi/Mumbai: In what can be seen as the biggest boost for Indian Economy, the Union Cabinet today cleared a number of modifications in Foreign Direct investment policy. The FDI modifications come at a time when the World Bank has projected 7.3 % growth rate for Indian Economy in 2018. It liberalizes the economy and boosts investors’ morale. The Modi-led cabinet set aside the previous limitations on FDI in various sectors and introduced modified limits.

The cabinet has approved 100% FDI under automatic route for Single Brand Retail Trading and Construction Development sector. While the major decision has been taken to revive the dying government venture Air India. Under the new amendments, foreign airlines have been allowed to invest up to 49% under the approval route.

Total FDI of US $ 60.08 billion was received in the financial year 2016-17 which is an all-time high. Thus, the government is eyeing for more investment with the improved policy in the new year.

Here are the details of the amendments in various sectors:

Single Brand Retail Trading (SBRT)

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The government today decided that its approval will no longer be required for FDI in SBRT. The existing policy on SBRT allows 49% FDI under automatic route and FDI beyond 49% and up to 100% through Government approval route. It has now been decided to permit 100% FDI under automatic route for SBRT.

Civil Aviation

FDI

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Under the current policy, foreign airlines are allowed to invest under Government approval route in the capital of Indian companies operating scheduled and non-scheduled air transport services, up to the limit of 49% of their paid-up capital. However, this provision was presently not applicable to Air India, thereby implying that foreign airlines could not invest in Air India. It has now been decided to do away with this restriction and allow foreign airlines to invest up to 49% under approval route in Air India subject to the conditions that:

  • Foreign investment(s) in Air India including that of foreign Airline(s) shall not exceed 49% either directly or indirectly
  • Substantial ownership and effective control of Air India shall continue to be vested in Indian National.

Construction Development: Townships, Housing, Built-up Infrastructure and Real Estate Broking Services

It has been decided to clarify that real-estate broking service does not amount to real estate business and is, therefore, eligible for 100% FDI under the automatic route.

Power Exchanges

FDI

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The extant policy provides for 49% FDI under automatic route in Power Exchanges registered under the Central Electricity Regulatory Commission (Power Market) Regulations, 2010. However, FII/FPI purchases were restricted to secondary market only. It has now been decided to do away with this provision, thereby allowing FIIs/FPIs to invest in Power Exchanges through the primary market as well.

Pharmaceuticals:

FDI

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FDI policy on Pharmaceuticals sector inter-alia provides that definition of a medical device as contained in the Policy would be subject to amendment in the Drugs and Cosmetics Act. As the definition as contained in the policy is complete in itself, it has been decided to drop the reference to Drugs and Cosmetics Act from the policy. Further, it has also been decided to amend the definition of ‘medical devices’ as contained in the Policy.

 

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Additionals funds required to fulfill promises: Tripura CM to Centre

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BJP appointed Biplab Kumar Deb as the CM of Tripura after its victory over the LEFT Front 25 year rule.

Agartala: Tripura CM Biplab Kumar Deb has demanded additional financial aid from the Union government to fulfill the promises made during the state election.

Biplab Kumar Deb met Nripendra Misra, principal secretary to Modi at the Prime Minister’s Office in New Delhi to place these demands on Friday.

In a statement issued by the CM’s office, it mentioned “Some promises have been made to the people of the state. Fulfillment of all these promises can be possible with additional financial support from the Centre as the state government is passing through a very difficult financial position”.

Deb has desired an additional funding for filling up 12,222 vacant posts of school teachers, the introduction of the 7th central Pay Commission recommendations for state government employees, setting up a central agricultural university and a super-specialty hospital like the All India Institute of Medical Sciences (AIIMS) in Tripura.

The chief minister has also requested the Centre to allow one-time relaxation in educational and professional qualifications for teachers in Tripura.

After the first BJP government in Tripura came to power in March, it was sanctioned Rs 2,587 crore central funds for development projects and schemes such as housing, education, and rural jobs.

According to the BJP, Tripura is under a deficit of Rs 11,355 crore, accumulated during the 25 years of Left Front rule.

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Death to child rapists: Union Cabinet approves the POCSO Act

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Keeping in mind the uproar over the recent rapes of minors in the nation, the Union Cabinet has approved the promulgation of an ordinance to allow courts to award death penalty to those convicted of raping children up to 12 years of age.

Official sources said in New Delhi that the criminal law amendment ordinance seeks to amend the Indian Penal Code (IPC), the Evidence Act, the Code of Criminal Procedure (CrPC) and the Protection of Children from Sexual Offences (POCSO) Act to introduce a new provision to sentence convicts of such crimes punishment of death.

Until now,  the minimum punishment for such heinous crimes was seven years in jail and the maximum was a life-term.

The move comes after the outrage caused by the nation due to the rape and murder of minor girls in Kathua and Surat district recently. But even while the Cabinet led by PM Narendra Modi was meeting on Saturday morning to discuss the issue, the rape and murder of a four-month-old infant in Indore sent fresh disturbance across the country.

 

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Cabinet approves Fugitive Economic Offenders Ordinance 2018: Provision for confiscating properties of escapees

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The cases where the total value involved in such offences is Rs.100 crore or more will come under this order.

The Union Cabinet has approved the Fugitive Economic Offenders Ordinance 2018. This would help in laying down measures to deter economic offenders from evading the process of Indian law by remaining outside the jurisdiction of Indian courts.

The cases where the total value involved in such offences is Rs.100 crore or more will come under the purview of this Ordinance.

Prime Minister Narendra Modi had earlier approved the proposal of the Ministry of Finance to introduce the Fugitive Economic Offenders Bill, 2018 in Parliament.

The ordinance states to re-establish the rule of law with respect to the fugitive economic offenders as they would be forced to return to India to face trial for scheduled offences. This would also help the banks and other financial institutions to achieve higher recovery from financial defaults committed by such fugitive economic offenders, improving the financial health of such institutions.

A special forum to be created for the expeditious confiscation of the proceeds of crime, in India or abroad, would coerce the fugitive to return to India to submit to the jurisdiction of Courts in India to face the law in respect of scheduled offences, according to the ordinance.

In the near past, there have been several instances of economic offenders flee in the jurisdiction of Indian courts, anticipating the commencement, or during the pendency, of criminal proceedings. The absence of such offenders from Indian courts has several deleterious consequences – first, it hampers investigation in criminal cases; second, it wastes precious time of courts of law, third, it undermines the rule of law in India.

The ordinance has provisions for a Court (‘Special Court’ under the Prevention of Money-laundering Act, 2002) to declare a person as a Fugitive Economic Offender.

 

A Fugitive Economic Offender is a person against whom an arrest warrant has been issued in respect of a scheduled offence and who has left India so as to avoid criminal prosecution, or being abroad, refuses to return to India to face criminal prosecution.

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