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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)

FDI

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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:

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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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Shakitikanta Das to be the new RBI governor

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New Delhi | Former Economic Affairs Secretary Shakikanta Das is likely to be the next Reserve Bank of India Governor after the resignation of Urjit Patel on December 10.

Shaktikanta Das, a retired 1980 batch Indian Administrative Service (IAS) officer of Tamil Nadu cadre was the member of the Fifteenth Finance Commission of India, and India’s Sherpa to G20. Das also worked as Union Economic Affairs Secretary, Union Revenue Secretary, Union Fertilizers Secretary, special secretary in the Department of Economic Affairs of the Ministry of Finance and as a joint secretary in the Department of Expenditure of the Ministry of Finance in the Indian government.

Earlier Urjit Patel on December 10 resigned from the post of Reserve Bank of India (RBI) governor. Patel’s three year team was to end in September 2019. Patel is also the first RBI governor to resign since 1990.

Submitting his resignation, Urjit Patel cited personal reasons and stepped down with immediate effect. He said, “On account of personal reasons, I have decided to step down from my current position effective immediately. It has been my privilege and honour to serve in the Reserve Bank of India in various capacities over the years,” Urjit Patel said in a statement. “The support and hard work of RBI staff, officers and management has been the proximate driver of the Bank’s considerable accomplishments in recent years. I take this opportunity to express gratitude to my colleagues and Directors of the RBI Central Board, and wish them all the best for the future,” he added.

 

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Four policemen killed by terrorists in J-K’s Shopian; weapons snatched

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Jaish-e-Mohammed

Srinagar | Four policemen were killed on Tuesday when Pakistan-based Jaish-e-Mohammed terrorists attacked a guard post outside a minority pocket in south Kashmir’s Shopian district, officials said.

The attack took place this afternoon when four policemen were sitting in a pre-fabricated room outside the pocket that houses six Kashmiri Pandit families.

A senior police official said that six Jaish-e-Mohammed terrorists were led by former Special Police Officer Adil Bashir, who deserted in October and decamped eight weapons from a PDP legislator.

Quoting eyewitnesses, the police officer said that militants fired indiscriminately, killing three policemen on the spot and critically injuring one.

The injured policeman was rushed to an Army hospital, where he also succumbed to injuries, the official said.

The deceased have been identified as Anees Ahmad, Hamidullah, Mehraj ud Din and Abdul Majeed.

At the time of the incident, only one family was present at the minority pocket.

Immediately after the shootout, the terrorists fled with three Self Loading Rifles (SLRs) of the policemen, the official said, adding a cordon and search operation has been launched to nab the criminals.

The official said that an intercept had been received in which it was clear that Jaish-e-Mohammed, a banned terrorist organisation, was behind the barbaric act.

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PM Modi may visit Tripura in Feb to inaugurate projects: Officials

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Narendra Modi

Agartala | Prime Minister Narendra Modi is scheduled to visit Tripura in February to inaugurate several development projects, including an upgraded cancer centre, a government official said. The regional centre, which offers treatment to more than 2,000 cancer patients annually, is set to have a new building and modern equipment, he said.

According to government reports, 3,786 patients succumbed to cancer between 2013 and 2016 in the state.

Sanjoy Mishra, the media adviser to chief minister Biplab Kumar Deb, said a high-level meeting was convened Monday to review progress in the cancer hospital project. “The Prime Minister is scheduled to visit Tripura in February to inaugurate several developmental projects. The newly built building at the cancer centre is one of them. Chief Minister Biplab Kumar Deb on Monday reviewed the progress of the construction work at the centre,” Mishra said.

Chief Secretary LK Gupta, Public Works Department (PWD) secretary Manoj Kumar, and Health and Family Welfare secretary Samarjit Bhowmik were among those who attended Monday’s meeting, he said. “The CM would be visiting New Delhi tomorrow (Wednesday) and meet the prime minister to discuss various issues, including the inauguration of the cancer hospital building,” Mishra told reporters.

According to the Global Adult Tobacco Survey (2016-17), 40 percent of all cancer patients in the northeast suffer from head and neck malignancy, mainly caused by tobacco consumption.

Tripura tops in tobacco use in the region with 64.5 percent patients in the state admitting to nicotine consumption, the report added.

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