Cabinet clears 100% FDI for railways, 49% for defence

Moving ahead with the economic reforms, the Cabinet tonight cleared the long-delayed proposal for raising FDI limit in defence to 49 percent and fully opened up the railway infrastructure segment, like high-speed trains, for foreign investment.

hidden August 06, 2014 22:21:56 IST
Cabinet clears 100% FDI for railways, 49% for defence

New Delhi: Moving ahead with the economic reforms, the Cabinet tonight cleared the long-delayed proposal for raising FDI limit in defence to 49 percent and fully opened up the railway infrastructure segment, like high-speed trains, for foreign investment.

The decisions taken at the Cabinet meeting headed by Prime Minister Narendra Modi here came barely two weeks after the one to raise the cap of FDI in insurance sector from 26 percent to 49 percent.

Cabinet clears 100 FDI for railways 49 for defence

Representational image. AFP

FDI ceiling in the sensitive defence sector has been hiked to 49 per cent from current 26 per cent, with the condition that of the control in joint venture manufacturing defence equipment will remain Indian hands.

The move is aimed at boosting domestic industry of a country which imports up to 70 percent of its military hardware.

The proposal had been pending for several years as it was first mooted by the Commerce Ministry during the previous UPA government. However, the then Defence Minister AK Antony had blocked it, citing national security concerns.

The NDA government has been arguing that the FDI limit needs to be hiked in defence to help expand the domestic industrial base in the sector.

The Cabinet also approved a proposal to open up cash-strapped railways to foreign investment by allowing 100 percent FDI in areas such as high-speed train systems, suburban corridors and dedicated freight line projects implemented in PPP mode.

The FDI liberalisation in the sector would help in modernisation and expansion of the railway projects. However, FDI will not be allowed in train operations and safety.

According to estimates, the sector is facing a cash crunch of around Rs 29,000 crore and allowing of FDI will help mop up resources.

PTI

Updated Date:

also read

Mamata writes to Modi, says Bengal ready to donate land for COVID-19 vaccine bulk manufacturing
India

Mamata writes to Modi, says Bengal ready to donate land for COVID-19 vaccine bulk manufacturing

The West Bengal chief minister called on the prime minister for liberal and proactive import of COVID-19 vaccines

India, UK unveil 10 yr partnership roadmap after Narendra Modi, Boris Johnson virtual meet
India

India, UK unveil 10 yr partnership roadmap after Narendra Modi, Boris Johnson virtual meet

The countries agreed to negotiate a comprehensive and balanced Free Trade Agreement including an interim trade pact for delivering early gains

Indian Navy has offered help to all State govts in fighting COVID, Chief Admiral Karambir Singh tells PM
India

Indian Navy has offered help to all State govts in fighting COVID, Chief Admiral Karambir Singh tells PM

Naval hospitals are being opened for civilian use in various cities, Singh told Narendra Modi, while briefing him about the initiatives taken by the Indian Navy to help fight COVID-19