According to Commerce and Industry Minister, Nirmala Sitharaman, the Union Cabinet will soon take a call on the winding up of the Foreign Investment Promotion Board (FIPB).
In a media briefing on initiatives and achievements of the ministry in the last three years, Nirmala Sitharaman said, “A decision has been made for closure of the FIPB. Necessary arrangements will have to be made on which discussions have happened among several ministries. The Cabinet has to take a call on it.”
The foreign Investment Promotion Board (FIPB) is a 25-years-old national agency of government of India, with the remit to consider and recommend Foreign Direct Investment (FDI) which does not fall under the automatic route. FIPB was housed in the Department of Economic Affairs, Ministry of Finance. Finance Minister Arun Jaitley had proposed in the budget speech 2017-18 that FIPB will be abolished in financial year 2017-18.
The government did not declare the modalities of the new system of processing applications which cover under the approval route.
In early of 1990s, the FIPB was constituted under the Prime Minister’s office in the wake of economic liberalisation.
Defence and retail trading sectors are fall under the approval route for FDI. As per the proposed mechanism, respective ministries would take care of the FDI proposals.
Sitharaman replied when asked about more liberalisation in the FDI policy that the government has brought in a number of big-ticket reforms and the process will continue.
She said, “We will have a lot more discussions on easing up (FDI norms).”
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