Swedish clothing giant Hennes & Mauritz AB has got the FIPB approval to invest about Rs 720 crore for opening stores across the country.
The H&M's proposal has been cleared, said a finance ministry official after the meeting of the Foreign Investment Promotion Board.
The company had made an application to enter the Indian market in April in the single brand retail category.
H&M, one of the world's largest fashion companies, has 3,000 stores spread across 53 markets worldwide.
This is the second Swedish firm after IKEA to get the nod to set up stores in India recently. The government has further liberalised FDI norms in the retail sector, allowing 100 percent FDI in single-brand retail.
India has cleared 60-70 proposals of single brand retail since 2006 when the segment was opened to foreign investments.
Earlier this year, the government had cleared furniture-maker IKEA's Rs 10,500-crore proposal to set up operations in the country.
Sources said FIPB, headed by economic affairs secretary Arvind Mayaram, cleared 14 proposals in all at today's meeting. There were 23 items on the agenda.
Swiss building materials major Holcim also got the FIPB nod to merge holding firm Holcim India with its unit Ambuja Cements as part of the plan to restructure its India operations.Holcim, which has majority stakes in two leading Indian cement makers - ACC and Ambuja Cements - had announced plan in July to consolidate operations in a cash and share deal in a two-step process, valued at about Rs 14,500 crore.
However, sources said, since Holcim's proposal is of more than Rs 1,200 crore, it would require approval of the Cabinet Committee on Economic Affairs (CCEA) headed by Prime Minister Manamohan Singh. Holcim had said that as part of the rejig process, Holcim India's over 50% stake in ACC will go to Ambuja. Holcim's stake in Ambuja will rise to 61.39%, from a little over 50% after merger of Holcim India with Ambuja. Ambuja Cements would merge Holcim India through cash and share transactions. Ambuja will first acquire a 24% stake in HIPL for Rs 3,500 crore, followed by stock merger between HIPL and Ambuja.
Decision on Veriant Systems's foreign investment proposal has been deferred as comment of the Ministry of Defence was awaited.
Besides, Vodafone's proposal to acquire 100 percent stake in its Indian arm was not take up in the meeting as all the ministries and departments concerned did not give their comments.
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Updated Date: Dec 21, 2014 01:02:46 IST