Relaxations are also made on FDI on medical devices and firms receiving foreign investments.
"The Union Cabinet, chaired by the Prime Minister Narendra Modi, has given its approval to a number of amendments in the FDI Policy". It received a $5.8 billion in bailout funds from the taxpayer, but still needs more capital to become profitable.
"Foreign investment (s) in Air India including that of foreign airline (s) shall not exceed 49 per cent either directly or indirectly substantial ownership and effective control of Air India shall continue to be vested in Indian National", the statement said. Commenting on this strategic move by the government, commerce minister Suresh Prabhu said that this Liberalization move was to gather more investments, and develop the economy of India.
He also highlighted the fact that "despite such reckless and imprudent misadventure", Air India has struggled to come back to operating profit for last three years.
Even while acknowledging that changes in FDI policy should not be equated with big reforms - that description should be reserved for such changes as fundamentally reshaping agricultural or labour markets - this criticism is a tad unfair.
Swadeshi Jagran Manch has said that easing the norms for FDI in SBRT would go against the best interest of the country.
Catalyst Paper caught in United States trade dispute over newsprint
The government said it has launched a wide-ranging complaint against the United States over its trade practices. In sharp contrast to USA publishers' warnings of potential devastation for small-town newspapers, Mr.
In turn, it will lead to larger FDI inflows contributing to growth of investment, income and employment, the government said in a statement. The Cabinet has allowed 100% FDI via automatic route in single brand retail trading and construction, while it has raised the existing limit in power exchanges and aviation sectors.
However, FII/FPI (foreign portfolio investors) purchases were restricted to secondary market only.
In construction sector, the Government clarified that real-estate broking service eligible for 100% FDI under automatic route.
These include any instrument, apparatus, appliance, implant, material or other articles, whether used alone or in combination, plus any software tool, intended by its manufacturer to be used especially for human beings or animals for diagnosis, prevention, monitoring, treatment or alleviation of any disease or disorder. It also permitted foreign airlines to invest up to 49 percent under the approval route in the debt-ridden, loss making national carrier.
Allowing incremental sourcing undertaken by overseas companies to be counted towards the 30% sourcing commitment for the initial five years will provide them with the flexibility and time to align their retail and sourcing business in India.
"Global brands across different categories, from apparel to electronics to accessories will be aided through this, providing further options to Indian consumers and improving India?s ranking in ease of doing business", he added.