FDI Limit for Defence Equipment Hiked from 49% to 74%; FM Stresses on 'Make in India' for Defence In the fourth tranche of measures, Finance Minister Nirmala Sitharaman announced policy reforms that will help build Atmanirbhar Bharat (self-reliant India)

By Shipra Singh

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.


In the fourth tranche of measures under the special economic package of INR 20 lakh crore, Finance Minister Nirmala Sitharaman on Saturday announced policy reforms that will help build Atmanirbhar Bharat (self-reliant India).

FM stated that India needs to prepare for global competition by building a self-reliant country, adding that India also needs to face the challenges of the global value chain. "We are not looking inwards. It is making India rely on its strength, while facing the global challenges," she said.

Emphasis on Saturday's announcement was on policy reforms to fast-track investment in order to attain "Atmanirbhar Bharat'. This included fast track investment clearance through Empowered Group of Secretaries (EGoS), creation of Project Development Cell in each Ministry to prepare investible projects, coordinate with investors and Central/State Governments, ranking of States on investment attractiveness to compete for new investments and launch of incentive schemes for promotion of new champion sectors in sectors such as Solar PV manufacturing, advanced cell battery storage etc.

The fourth tranche of the economic package focused on eight sectors—coal, minerals, defence production, airspace managements/airports/MRO, power distribution companies in UTs, the space sector and atomic energy.

To reduce import of substitutable coal and increase self-reliance in coal production, the government is introducing competition, transparency and private sector participation in coal sector through a revenue sharing mechanism in place of regime of fixed rupee/tonne. This will allow all and any party to bid for a coal block and sell it in the open market. The government will offer nearly 50 block immediately with no eligibility conditions, but only upfront payment with a ceiling.

On the defence equipment production front, the government will notify a list of weapons/platforms for ban on import with year-wise timelines, and will also ensure indigenisation of imported spares. For this, a separate budget will be given for domestic capital procurement ad this move will help to reduce the huge defence import bill, the FM claimed. Further, FDI limit in defence manufacturing under automatic route will be raised from 49 per cent to 74 per cent.

For the aviation sector, the government has decided to ease restrictions on utilisation of the Indian air space to increase efficiency of civilian flying. Only about 60 per cent of the Indian airspace is freely available right now which makes flying routes longer for airlines. Freeing up more space will bring a total benefit of INR 1,000 crore a year for the aviation sector as well as lead to a positive environmental impact as shorter routes will reduce fuel usage. Also, six more airports were announced for auction under a Public-Private Partnership (PPE) model.

Shipra Singh

Entrepreneur Staff

Freelance Journalist

Now a freelance journalist, ealier steered the Wealth section on the Entrepreneur website, covering everything finance. Previously a personal finance reporter at The Economic Times and Outlook Money.

Related Topics


Google Is About to Delete Inactive Accounts. Here's How to Avoid A Massive Gmail Bounce Rate.

Google will start deleting inactive accounts soon. For businesses like yours, that means many Gmail contacts will probably bounce. Here's how you can avoid that – and keep your business emails landing in the inbox.

Business News

An Ivy League University Is Teaching the Secret of Taylor Swift's Success

Several major universities have added courses dedicated to studying Swift's star power.

Buy a Franchise

Learn the Secrets of Running 20+ Businesses as a Side Hustle — Finding and Nurturing Your 'STIC People'

Explore the critical importance of choosing the right franchise manager and the innovative 'STIC' approach.

Business Ideas

This Teacher Sells Digital Downloads for $10. Her Side Hustle Now Makes Six Figures a Month: 'It Seems Too Good to Be True, But It's Not.'

When one middle school teacher needed to make some extra income, she started a remote side hustle with no physical products and incredibly low overhead. Now she brings in six figures each month, and offers courses teaching others how to do the same.


How to Avoid Email Spam Complaints

Here's how to stop spam complaints from putting up a roadblock to your communication pipeline.