FIPB clears Rs 13,000-crore proposals, puts 1st 100% FDI plan in defence on hold

NEW DELHI: The Foreign Investment Promotion Board ( FIPB) has cleared proposals worth more than Rs 13,000 crore, including one by Axis Bank to increase overseas shareholding entailing an inflow of Rs 12,900 crore.

The first proposal for 100% FDI in defence to be made under the new policy, from DCNS, a global leader in submarine systems, was deferred by the board as the ministries of defence and home affairs sought more time to examine it.

India changed FDI rules for the defence sector in November, allowing up to 49% under the automatic route.

Proposals with higher investment levels need to be approved on a case-by-case basis by the FIPB in consultation with ministries after which they are sent to the Cabinet Committee on Economic Affairs for consideration.

Axis Bank’s plan to raise foreign shareholding to 74% from 62% now will go to the CCEA as the foreign direct investment inflow proposed is Rs 12,900 crore.

The Foreign Investment Promotion Board can only clear proposals of up to Rs 5,000 crore.

“Axis Bank’s proposal has been cleared,” said a government official privy to the deliberations of the FIPB meeting.

Proposals by Aurobindo Pharma, Wockhardt and Funai India also received the board’s nod. The Foreign Investment Promotion Board rejected one of the 14 proposals it took up on Friday.