Cabinet nod for 100% FDI in single-brand retail via automatic route

Cabinet nod for 100% FDI in single-brand retail via automatic route

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Aviation and retail stocks are in focus as Union Cabinet is meeting to review the foreign direct investment (FDI) policy today.

The Union Cabinet is likely to review foreign direct investment (FDI) policy in certain sectors today with a view to attract more overseas funds, sources said.

The sectors, which could be considered for further relaxation, include construction and single brand retail.

According to sources, FDI policy review in various sectors is expected to figure in today's meeting of the Union Cabinet headed by Prime Minister Narendra Modi.

Last year, there was a proposal to permit 100 percent FDI through automatic route in single brand retail trading. Currently FDI up to 49 percent is permitted under the automatic route but beyond that limit government nod is required.

The relaxation of policy is aimed at providing investor friendly climate to foreign players and in turn attract more FDI to boost economic growth and create jobs.

FDI during April-September this fiscal grew by 17 percent to USD 25.35 billion.

Don't think 100 percent FDI in single-brand retail will make a big difference to the company, said Sandeep Jain, Executive Director of Monte Carlo Fashions in an interview to CNBC-TV18.

He further said that many foreign companies already have joint ventures (JVs), partnership or some licensing arrangements with domestic companies.

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