FDI

The government is set to clear a higher limit of foreign direct investment (FDI) in railways and defence but a plan to allow foreign investment in e-commerce has been put on the backburner.

According to the plan, FDI up to 100 per cent would be allowed under the automatic route in railway infrastructure projects. This would also include projects such as high-speed train systems, suburban corridors and dedicated freight line that are executed under public-private partnership (PPP) mode.

"A higher FDI cap of 49 per cent, when read along with the relaxed industrial licensing policy for defence production would give a big fillip to domestic production of defence equipment,” said another official, pointing out that currently, nearly 70 per cent of the country’s defence requirements are imported.

“The proposals for enhancing the FDI cap in railways and defence are likely to be taken up by the Cabinet in the next fortnight or even earlier. The department of industrial policy and promotion is finalising these,” said the official