Panel for FDI in retail, housing

new delhi: the planning commission steering committee on foreign direct investment, headed by n k singh, has favoured the opening up of ticklish sectors like retail, real estate and housing and plantations including tea and tobacco for foreign investment. the view is to open up these sectors with adequate safeguards in the form of sectoral caps in the initial phase. the steering committee is essentially looking at ways to make fdi touch $8 billion per annum over the next five years. the budget 2002-03 is expected to draw inputs from the recommendations of the committee. the committee is giving finishing touches to its report which will be submitted ahead of the tenth plan formulation. the committee is looking at opening up small segments of the print media for foreign investment such as scientific journals and niche periodicals, subject to sectoral caps. however, the committee does not favour recommending foreign investment in mainstream media, newspapers or magazines. on telecom too, the committee is unlikely to favour any further enhancement on the sectoral cap. planning commission advisor arvind virmani told reporters that critical areas that would boost fdi include enhancement of sectoral caps, a legal framework for speedy clearance of infrastructure and sez projects. another proposal under consideration was to enact a separate legislation for special economic zones given the key role they play in attracting fdi. “as of now, we do not have a foreign investment law. the present provisions are covered under foreign exchange management act. we are considering both options of strengthening existing institutions like the fipb and fiia as also setting up a separate law on fdi,� he said. quoting the andhra example of time-bound clearance of infrastructure projects, dr virmani said a similar legislation was needed to remove procedural hurdles. “andhra pradesh has enacted a law which sets time-frames for clearance. we are examining if the same can be replicated in the form of a national law,� he said. virmani allayed fears of fdi swamping india once sectoral caps are eased. this is because fdi in india was far below that of countries such as china, adding the committee was of the view that efforts were needed to use fdi to make exports easier. according to a planning commission paper, india was ranked 126th out of 150 countries in the ratio of fdi to total investment. fdi as a percentage of total investment in india is 2.1 per cent against an average of 2.5-3.5 per cent for other countries.