8 FDI Proposals Including Telenor Get Govt. Nod

In its quest to speed up the reforms engine and fill up its coffers with much-needed foreign exchange, the government has approved 8 more Foreign Direct Investment (FDI) proposals worth around Rs 1311.54 crore. These were considered by the Foreign Investment Promotion Board (FIPB) in its June 14 meeting, and the approval came on the recommendation of the board.

It is important to note here that as recently as June 18, the government has cleared 16 FDI proposals worth Rs 1646.875 crore. In all, 25 proposals amounting to around Rs 3000 crore have been cleared in less than a month’s time.

Among the latest 8 proposals approved, a maximum investment of Rs 1000 crore was in the telecom sector, wherein Norwegian company Telenor Mobile Communication will set up a JV company. Another Rs 280 crore proposal by Mahle Holding India to bring in more investment via a 100% FDI investing company has also been approved, as has one by Srei Infrastructure Finance to undertake the activity of setting up white label ATMs (WLAs).

On the other hand, Jet Airways’ proposal to make a preferential allotment of 24% equity shares to Etihad Airways has been deferred, along with 10 others. The UAE-based Etihad wants to subsequently transfer the equity to its wholly-owned subsidiary, which is now a bone of contention among ministries, and there is no clarity on this Rs 2058 crore deal so far. Other proposals that were deferred include that of Muthoot Finance to set up white label ATMs and Soma Tollways’ proposal of post facto approval for increase in foreign equity in the investing company.

The government has also rejected six proposals, which include the Multi-Commodity Exchange of India’s (MCX) proposal of bringing foreign investment into trading commodities. Experts are of the opinion that this is a big blow for the company. Two proposals have been advised to access the automatic route.