3 Areas To Be Privileged After Government Unfurls Red Carpet For FDI

Union Cabinet has opened doors for foreign investors to create employment opportunities in various sectors and stabilizing Indian economy through FDI influx

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The Union Cabinet has approved easing the foreign direct investment norms for various sectors to attract foreign investors. The Cabinet in its meeting related to economy decided to relieve foreign investment in coal mining and related infrastructure, contract manufacturing, single-brand retail and digital media.


"The changes in FDI policy will result in making India a more attractive FDI destination. These updates in FDI norms will assist companies from all over the globe to look for alternative manufacturing hubs and help create a large number of jobs" said Commerce and Industry Minister, Piyush Goyal

In a recent meeting conducted by Finance Minister Nirmala Sitharaman, mentioned to announce more measures to boost the economy in the coming weeks. According to the reports given, the next package along with the FDI investors may be announced for the infra sector.

"The government will spend a sufficient amount of money in infra sector. Spending on infra is the priority of the government and will be applied soon to boost our economy ahead" said FM Sitharaman.

Areas to be benefited with the ease in FDI norms

Digital Media:

With the arrival of new FDI transformed norms, Indian digital media receives 26% FDI for its growth. Although some digital media organisation do not fulfil the demands of FDI investors, but rest, are liable to fall under the category to receive 26% FDI. Until now, there was no separate category as digital media for the FDI purpose. But now, distinct from print and broadcast media, digital media is a whole another category to receive this benefit. However, few media industrialists reacted differently to the decision as present FDI in various digital platforms are at different levels. Some digital media companies have 100 per cent FDI, while some others are restricted to 49 per cent.

Contract Manufacturers:

According to the Commerce Minister, Several companies seek to approach large scale manufacturers for contractual manufacturing which is cost effective, good for economy, scales and assists in up gradation of technology. DI norms did not allow foreign investment to such contract manufacturer so far. Now any contract manufacturer, big or small, will get 100 per cent FDI. Due to ongoing trouble all over the globe, various companies are expecting to set up their manufacturing units. Now, after liberalising FDI, these steps would help with ease of doing business, influx of foreign investment will increase, and FDI regime will be simplified. It will boost the employment for youth of the country.

Single Brand Retail:

The Union Cabinet has decided to bring Single Brand Retail sector under the relaxed norms of FDI. However, it would be responsible for employment boost. It is one of the biggest pillars of Indian economy which serves over 10% of its GDP.