The finance minister P Chidambaram, who opened the doors of multi-brand retail, aviation, power, etc to foreign investors last year, may now head the proposed empowered group of ministers (EGoM) on FDI policies, said a media report.
The report quoted a government official as saying that the eGoM will seek to overhaul the country's FDI policy by raising caps in defence, telecom, multi-brand retail, insurance and pension sectors.
As EGoM has the power to decide and doesn't require cabinet's approval, the government aims to bring in all the changes in the next revision of Consolidated FDI Policy, to be effective from October 1.
Arvind Mayaram, secretary for economic affairs, had yesterday suggested raising the FDI cap in the defence, telecom, multi-brand retail, insurance and pension sectors. He also called for simplifying the FDI regime by reducing overall layers of cap; like in some sectors it is 26 per cent, in others it is 49 per cent, and in some it is 51 per cent or 75 per cent.
Mayaram panel has recommended raising the FDI limit in the defence sector from 26 per cent to 49 per cent and in telecom from 74 per cent to 100 per cent. It also wants raising of the cap in the insurance and pension sectors.
Even as the country has not received any FDI proposal so far after India allowed 51 per cent FDI in in multi-brand retail sector, Mayaram has proposed that this limit be increased to 74 per cent.