Union Finance Minister Nirmala Sitharaman on Friday proposed easing foreign direct investment norms for several sectors, including media, aviation, insurance, and single-brand retail. The minister said this was an attempt to attract more foreign investment to the country.
“I propose to further consolidate the gains in order to make India a more attractive FDI [foreign direct investment] destination,” Sitharaman said in Parliament while presenting the Union Budget. “The government will examine suggestions of further opening up of FDI in aviation, media [animation, visual effects, gaming and comics], and insurance sectors in consultation with all stakeholders.”
Sitharaman also said 100% foreign investment would be permitted for insurance intermediaries along with easing up of local sourcing norms for foreign direct investment in single-brand retail sector.
The finance minister said India’s foreign direct investment inflows between 2018 and 2019 had increased by 6% to $64.37 billion (Rs 4.4 lakh crore).
The Centre had relaxed foreign investment norms in media on November 2015 after the Bharatiya Janata Party lost the Bihar Assembly elections. The foreign investment limit in news channels and private FM radio was increased to 49% from 26%, and 100% foreign direct investment was allowed for entertainment channels. However, the government had decided not to raise the foreign direct investment cap in print media sector in India, keeping it unchanged at 26%.
In the Budget speech, Sitharaman said India would become a $3-trillion economy in the current financial year, and added that structural reforms were needed to achieve the target of becoming a $5-trillion economy by 2024.