FDI norms in certain sectors likely to be eased under new Govt: DPIIT Secretary

DPIIT Secretary Rajesh Kumar Singh said that in the last few years, India has liberalised FDI policy in many segments.

New Delhi: India has recently relaxed foreign direct investment norms in the space sector and there is a possibility of further FDI liberalisation in certain other areas when the new government will come to power, a top official said on Saturday.

Secretary in Department for Promotion of Industry and Internal Trade (DPIIT) Rajesh Kumar Singh said that in the last few years, India has liberalised FDI policy in many segments.

India has one of the most liberal foreign direct investment (FDI) policies in the world and in fact more liberal than many Southeast Asian countries that the country is often compared with, he said.

Recently FDI norms were eased in the space sector and "it is quite possible that under a new Government, we can attempt some further liberalisation of any pockets that are left and where some liberalisation is possible ," Singh said here at CII's annual business summit.

The Lok Sabha elections are underway in the country and the counting is scheduled for June 4.

The Government has eased FDI norms in the space sector by allowing 100 per cent overseas investment in making components for satellites, as part of efforts to attract overseas players and private companies into the segment.

FDI in India declined 13 per cent to USD 32.03 billion in April-December 2023, dragged down by lower infusion in computer hardware and software, telecom, auto, and pharma sectors, according to the government data.

Talking about the success of the Production Linked Incentive (PLI) schemes, the Secretary said so far Rs 1.13 lakh crore of investments have come in and the beneficiary companies have recorded over Rs 9 lakh crore of sales, exports of Rs 3.45 lakh crore and created jobs for over 8 lakh people.

The scheme was announced in 2021 for 14 sectors, including telecommunication, white goods, textiles, manufacturing of medical devices, automobiles, speciality steel, food products, high efficiency solar PV modules, advanced chemistry cell battery, drones, and pharma with an outlay of Rs 1.97 lakh crore.

Singh said some people criticize the scheme stating that it has not led to increase in domestic value addition but they should know that it takes time.

People have raised issues with regard to India attracting players in the semi-conductor segment stating that it is too capital intensive and not suitable for India.

"The target is not labour intensity, it is mainly strategic and to ensure that we do not become over dependent on unsecured supply chains," he said.

On ease of doing business, he said they are working on the World Bank's Business Ready (B-READY) index for which the survey will start in August and this ranking involves a new set of indices which will cover ease of entry, ease of operation and ease of exit of business.

The World Bank has shared a set of 1,370 questions which will be assessed across various economies.