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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

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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

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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:

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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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MiG 21 fighter jet crashes in Himachal’s Kangra; no news on pilot

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A MiG 21 fighter jet of the Indian Air Force crashed in the Kangra district of Himachal Pradesh on Wednesday, the police said.

The accident took place after 1 pm. A video shows the wreckage of the jet which took off from Punjab’s Pathankot, a frontline Indian Air Force base. Visuals from the site of the accident showed a part of the aircraft engulfed in flames, lying in what appears to be a field.

Superintendent of police of Kangra, Santosh Patial said the pilot was missing. The rescue team is on the way, reported a news agency.

In another aviation accident this year, a small aircraft crashed in a crowded Mumbai neighbourhood on June 28, killing five people, including four crew members and a pedestrian.

The Indian Air Force has been the world’s largest operator of the jet, the first variants of which entered service with the air force in the sixties. This is the second Indian Air Force fighter jet crash in two months.

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Functioning of the state government is ‘completely paralysed’ despite SC verdict: Delhi government

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New Delhi | The Aam Aadmi Party (AAP) led Delhi government on Wednesday told the Supreme Court that the functioning of the state government is “completely paralysed” and it can’t order transfer or posting of officers despite the recent Constitution bench verdict on the administration of Delhi.

The bench of Justices AK Sikri and Navin Sinha said it knows everything and the matter will be taken on July 26 since it is not a regular bench.

Senior advocate P Chidambaram who was representing the Delhi government said, “Functioning of the government is completely paralysed. We cannot post officers, we cannot transfer officers despite the recent constitution bench verdict which has explained every aspect. These issues needs to be adjudicated at the earliest.”

Senior advocate Indira Jaising, who also appeared for the Delhi government, said officers are not willing to file an affidavit on this matter and Delhi Deputy Chief Minister Manish Sisodia had therefore filed the affidavit. “I just wanted to clarify the situation.”

Earlier a five-judge Constitution bench including Chief Justice Dipak Misra recently stated broad parameters for the governance of the Delhi which had a constant power tussle between the Centre and Delhi government since the election of Aam Aadmi Party in 2014.

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Swami Agnivesh files complaint against assault; blames RSS, BJP Yuva Morcha

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Ranchi | Social Activist and self-proclaimed spiritual leader Swami Agnivesh on Wednesday lodged a complaint with Ranchi Police stating that a couple of people belonging to the right-wing group RSS, and BJP Yuva Morcha (BJYM) entered the premises and assaulted him.

Earlier on Tuesday, Swami Agnivesh was allegedly attacked by a mob when he had gone to Pakur, a place 30 km away from the Ranchi to address the tribals residing in the region. Jharkhand Chief Minister Raghubar Das after the attack provided safety to Agnivesh.

Congress President Rahul Gandhi on Wednesday while condemning the attack on the social activist took a jibe at the BJP in the form of a ‘pop quiz’ on Twitter.

Meanwhile, the Supreme Court on Tuesday condemned the rising mob violence and lynching incident and directed the Parliament to roll-out a new law to punish the defaulters.

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