FIPB clears six FDI proposals worth ₹85-cr investments

FIPB clears six FDI proposals worth ₹85-cr investments

NEW DELHI, APRIL 24:  The Foreign Investment Promotion Board (FIPB) has approved six proposals entailing foreign direct investment (FDI) of about ₹85 crore and has recommended(की सिफारिश की) one proposal for approval from the Cabinet Committee on Economic Affairs (CCEA). “The proposal involving ₹4,315 crore by Gland Pharma Ltd has been referred to the CCEA,” said an official statement on Monday.

The decisions pertain to the FIPB meeting held on March 29. A brownfield Indian pharmaceutical company Gland Pharma has sought approval for its initial acquisition of up to 86.08 per cent stake in Shanghai Fosun Pharmaceutical (Group) Company Ltd. Meanwhile, among the six proposals approved by the FIPB, three relate to the pharma sector. These include proposals by PMC Group International, Enaltec Labs and Bigtec Pvt Ltd. The FIPB also approved proposals of Powervision Export and Import India, Crown Cement Manufacturing and Entrepreneur India Media Private Limited.

It also deferred 11 proposals including four in the telecom sector by firms like Sistema Shyam, Datawind Innovations and Vodafone Mobile Services.

It also deferred two FDI proposals in the financial services and insurance sector including one by HSBC Securities and Capital Markets and another by Geodis Overseas.

Five proposals were also rejected by the Committee. These were by PERI India, Limpkin Telecom, LS Cable, Maxaim Network and Xerox India.

Historical Background of FIPB

The Foreign Investment Promotion Board (FIPB), housed in the Department of Economic Affairs, Ministry of Finance, is an inter-ministerial body, responsible for processing of FDI proposals and making recommendations for Government approval. The extant FDI Policy, Press Notes and other related notified guidelines formulated by Department of Industrial Policy and Promotion (DIPP) in the Ministry of Commerce and Industry are the bases of the FIPB decisions. In the process of making recommendations, the FIPB provides significant inputs for FDI policy-making.

Approvals under PMO: The FIPB was initially constituted under the Prime Minister's Office (PMO) in the wake of the economic liberalization drive of the early 1990s. The recommendations of the FIPB were approved through a 3-tier approval mechanism, viz. FIPB as a committee of senior officials to examine and make recommendations; Empowered Committee on Foreign Investment (ECFI) chaired by the Finance Minister for deciding on the recommendations of the FIPB for projects in which the total investment in the project was up to Rs. 300 crore; and the Cabinet Committee on Foreign Investment (CCFI) for deciding on the recommendations of the FIPB for projects in which the total investment was more than Rs. 300 crore.