Tag: FDI

Grofers India seeks govt approval for FDI in food trading

Grofers India seeks govt approval for FDI in food trading

14/09/2016 16:32

Grocery delivery start-up Grofers has sought government’s approval for foreign direct investment to carry out trading in food products.

The government has recently permitted 100 per cent FDI under government approval for trading, including through e-commerce, in respect of food products manufactured or produced in India.

As per the information on the website of the Department of Industrial Policy and Promotion (DIPP), Grofers India Pvt Ltd has sought approval “to undertake trading including through e-commerce in food products manufactured and/or produced in India”.

Union Minister Harsimrat Kaur Badal has said India’s food processing industry is expected to treble in coming years on the back of a higher economic growth.

The size of the industry is about Rs 1.5 lakh crore.

The food processing ministry has proposed to organise the World Food Summit in 2017 that would act as a single platform for investors, technology solution providers, processors, manufacturers and all other relevant national and international stakeholders.

FDI inflows into India stood at $5.34 bn in April-May

FDI inflows into India stood at $5.34 bn in April-May

22/07/2016 16:59

India received USD 5.34 billion foreign direct investment in the first two months of the current financial year, Parliament was informed today.

During April-May the country attracted USD 4.76 billion FDI under automatic route, while USD 582 million came through the approval route, Minister of State for Finance Arjun Meghwal said in a written reply to the Lok Sabha.

He said the government has made changes in the FDI policy in several sectors “to ensure that India remains increasingly attractive and investor friendly investment destination”.

The government has relaxed FDI Policy in sectors like defence, pharmaceuticals, aviation, food retailing and broadcast.

During the two months, defence received no FDI, while pharmaceuticals attracted USD 452.86 million foreign inflows.

The other sectors include air transport (USD 5.65 million), information and broadcasting (USD 39.2 million) and retail trading (USD 7.94 million).

Replying to a separate question, Meghwal said in the first quarter, April-June, of 2016-17 Foreign Portfolio Investors pumped in Rs 10,4561 crore.

“To attract global investor, a number of reforms were taken in the FDI policy and FPI policy,” he added.

FIPB clears 6 FDI proposals worth Rs 180 cr

13/07/2016 00:59

Inter-ministerial body FIPB cleared six foreign direct investment proposals worth about Rs 180 crore, said the PTI report.

The Foreign Investment Promotion Board has cleared six proposals including those of Janalaxami Finance and Turmeric Vision, a Finance Ministry official said.

The panel headed by Economic Affairs Secretary Shaktikanta Das had considered 15 proposals.

The official further said four investments proposals were rejected while decision on five were deferred for want of more inputs.

India allows FDI in over 90 per cent sectors via automatic route. However, investment proposals in sensitive sectors like telecom and banking go through FIPB.

In last two years, the government has taken a series of reforms measures to liberalise FDI regime. Last month, it announced FDI liberalisation in nine sectors such as civil aviation, retail and private security services. This was the current government’s second round of relaxation in these rules.

During 2015-16, FDI into the country increased by 29 per cent to USD 40 billion from USD 30.93 billion in the previous fiscal.

RBI notifies 49 pct FDI under automatic route in insurance

RBI notifies 49 pct FDI under automatic route in insurance

01/04/2016 00:44

Reserve Bank has notified 49 per cent foreign direct investment (FDI) under automatic route in insurance sector, said the PTI report.

“The extant FDI policy for insurance sector has since been reviewed by the Government of India and accordingly it has been decided to enhance the limit of foreign investment in insurance sector from 26 to 49 percent under the automatic route subject to certain terms and conditions which have been notified on March 30,” RBI said in a notification.

“No Indian Insurance company shall allow the aggregate holdings by way of total foreign investment in its equity shares by foreign investors, including portfolio investors, to exceed forty-nine percent of the paid up equity capital of such Indian Insurance company,” it said.

“The foreign investment up to 49 percent of the total paid-up equity of the Indian Insurance Company shall be allowed on the automatic route subject to approval or verification by the Insurance Regulatory and Development Authority of India,” it said.

The foreign equity investment cap of 49 per cent will apply on the same terms as above to Insurance Brokers, Third Party Administrators, Surveyors and Loss Assessors and Other Insurance Intermediaries appointed under the provisions of the Insurance Regulatory and Development Authority Act,1999.

Earlier, only up to 26 per cent FDI was permitted through the automatic approval route. For FDI up to 49 per cent, the approval of the Foreign Investment Promotion Board was required.

There are 52 insurance companies operating in India, of which 24 are life insurance business and 28 in general insurance.

Govt allows 100 pct FDI in e-commerce marketplaces

Govt allows 100 pct FDI in e-commerce marketplaces

30/03/2016 01:51

The government permitted 100 per cent FDI in the market place format of e-commerce retailing with a view to attract more foreign investments.

As per the guidelines issued by the Department of Industrial Policy and Promotion (DIPP) on FDI in e-commerce, foreign direct investment (FDI) has not been allowed in inventory-based model of e-commerce.

At present, global e-tailer giants like Amazon and Ebay are operating online marketplaces in India while homegrown players like Flipkart and Snapdeal have foreign investments even as there were no clear FDI guidelines on various online retail models, reported PTI.

To bring clarity, the DIPP has also come out with the definition of ‘e-commerce’, ‘inventory-based model’ and ‘market place model’.

Market place model of e-commerce means providing of an IT platform by an e-commerce entity on a digital and electronic network to act as a facilitator between buyer and seller.

The inventory-based model of e-commerce means an e-commerce activity where inventory of goods and services is owned by e-commerce entity and is sold to consumers directly, according to the guidelines.

A market place entity will be permitted to enter into transactions with sellers registered on its platform on business-to-business basis, DIPP said.

It said that an e-commerce firm, however, will not be permitted to sell more than 25 per cent of the sales affected through its market place from one vendor or their group companies.

“In order to provide clarity to the extant policy, guidelines for FDI on e-commerce sector have been formulated,” DIPP said.

The government has already allowed 100 per cent FDI in business-to-business (B2B) e-commerce.

Post Session- Sensex sizzles, surges over 330 points

Post Session- Sensex sizzles, surges over 330 points

21/03/2016 16:16

Kicking off a new week on a bullish note, Indian equity benchmarks jumped by more than 1 per cent on Monday with the Sensex soaring by over 300 points and the Nifty surpassing the psychological level of 7,700 as the government’s decision to cut interest rates on small savings further bolstered speculation of a rate cut by the Reserve Bank of India (RBI) at its upcoming policy meet on April 5.

Marking a second straight rally, the 30-share Sensex jumped by 332.63 points or by 1.33 per cent to end at 25,285.37, while the Nifty closed at 7,704.25 up by 99.9 points or by 1.31 per cent.

The BSE Sensex touched intraday high of 25,327.45 and intraday low of 24,988.27. The NSE Nifty touched intraday high of 7,713.55 and intraday low of 7,617.7.

The country’s central bank is poised to cut the repo rate by at least 25 basis points next month as softening consumer inflation, coupled with the government’s decision to maintain fiscal prudence in the Union Budget leave more leeway for policy easing to help buoy demand and revive investments in Asia’s third biggest economy. Moreover, a reduction in the rate offered on small savings schemes, which are seen competing with term deposits offered by banks, also pave the way for further softening of borrowing costs.

Sentiment was also boosted after the Foreign Investment Promotion Board (FIPB) has given the green signal to 15 FDI investment proposals worth Rs 7,262 crore including that of Japanese insurer Nippon Life Insurance, Tata AIA and Aviva Life.

The top gainers of the BSE Sensex pack were Hindustan Unilever Ltd. (Rs. 880.35,+4.05%), State Bank of India (Rs. 196.65,+2.93%), Sun Pharmaceutical Industries Ltd. (Rs. 835.65,+2.42%), Larsen & Toubro Ltd. (Rs. 1227.80,+2.38%), Tata Motors Ltd. (Rs. 374.55,+2.36%), among others.

On the Sectoral front, consumer goods and capital goods advanced 2.01 per cent and 1.80 per cent, respectively.

The Market breadth, indicating the overall health of the market, was strong. On BSE out of total shares traded 3061, shares advanced were 1615 while 1246 shares declined and 200 were unchanged.

In Asia, China’s Shanghai Composite surged by more than 2 per cent to a two-month high and Hang Seng ended tad higher, as policymakers vowed to loosen curbs on the Chinese stock market. China Securities Finance Corp. stressed that it will boost lending to brokerages for their margin trading business in measures aimed at boosting the country’s stock market which recently fell prey to a rout and leverage more than halved from last year’s peak. Japan’s Nikkei 225 was closed for a holiday.

FDI in India up 29 pct after ‘Make in India’ launch: Min

FDI in India up 29 pct after ‘Make in India’ launch: Min

17/03/2016 10:15

The Indian Government has said that Foreign Direct Investment in the country has increased by 29 per cent for the 15-month period ended December last year after the launch of ‘Make in India’ initiative.

As per reports, the initiative aims at promoting India as an important investment destination and a global hub for manufacturing, design and innovation.

Commenting on the issue, Commerce and Industry Minister Nirmala Sitharaman told the media, “FDI inflow has increased 29 per cent during October 2014 to December 2015 (15 months after ‘Make in India’) compared to the 15 months period prior to the launch of this initiative.”

“During April-January 2016, the government has received 424 FDI proposals. Out these, 285 proposals have been disposed of,” he added.

The Minister further added that foreign investment in business to customer (B2C) e-commerce activities had been “opened in a calibrated manner” and entity was permitted to undertake retail trading through e-commerce under certain circumstances.

Harsimrat Badal calls for 100 pct FDI in food products multi-brand retail

10/02/2016 12:03

The Ministry of Food Processing Industries (MoFPI) has urged the Prime Minister for allowing 100 per cent foreign direct investment (FDI) in multi-brand retail for food items grown and processed within India, union minister, Harsimrat Kaur Badal said at an ASSOCHAM event in New Delhi on Tuesday.

“I have requested the Prime Minister that we must allow FDI in multi-brand retail of food which is grown and processed in India because it will give the push and the thrust to create that infrastructure which will help the industry prosper,” said Badal while inaugurating ‘8th Global Food Processing Summit’ organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

“This is in the interest of both consumers and farmers as it will bring down food inflation create more jobs and lead to rapid infrastructure development,” said Badal.

“FDI in multi-brand retail has come in food sector in our country, for example in my state Punjab it has been done, it has benefitted everybody, there is no trader in the middle who has lost out, there is no farmer who has lost, no industry has lost out, so it has been a win-win situation and it has been a tried and tested formula,” she added.

“The globally established brands and multi-national companies will promote technology transfer, something which has been missing in India due to lack of infrastructure,” further said Badal.

“There is an urgent need to promote policies and create conducive environment where food processing sector can flourish,” she said.

Terming food processing as a ‘sunrise sector’, the union minister said it is imperative to lay focus on this sector to improve farmers’ condition across India. “It will help benefit the consumer by reducing inflation, reduce wastage, increase availability of fresh and processed variety of food at a stable price, improve farming technology.”

FDI in multi-brand retail of food won’t harm local mkts: ICRIER

04/02/2016 17:19

The Centre must consider allowing FDI in multi-brand retail of food and grocery to boost food processing as it is unlikely to pose any threat to local stores because a majority of Indian consumers still buy fruits and veggies from the local markets, an ICRIER report said.

The current policy already has a provision for allowing 51 per cent foreign direct investment (FDI) in multi-brand retail and the BJP-led NDA government has not yet rolled back the policy decision taken by the previous UPA regime, said the media report.

The report by Delhi-based think tank Indian Council of Research on International Economic Relations (ICRIER) comes weeks after Food Processing Minister Harsimrat Kaur Badal wrote to the Prime Minister suggesting a “relook” at the country’s FDI policy in multi-brand retail in food processing.

“The survey findings show that a majority of Indian consumers prefer to buy fruits and vegetables from the local markets (53.3 per cent) and push carts (18.8 per cent) despite presence of organised retail stores in select metros,” ICRIER’s Arpita Mukherjee said.

So, allowing FDI multi-brand retail of food and grocery sector will not have any impact on local vendors. “Therefore, the government must explore the possibility of liberalising FDI in multi-brand retail and ease conditions on foreign investors to improve access to variety of products,” she said.

At present, the food and grocery sector is largely non-corporate and there are restrictions on FDI in multi-brand retail. Further, some states do not allow direct sourcing. As a result, global multi-nationals have not shown interest in investing in the food supply chain.

High taxes on processed fruits and vegetables and variations in taxes across states also hinder the processing, she added.

Besides this, the ‘Indian Phytonutrient report’ which was released today made several recommendations to address the supply chain barrier of fruits and vegetables in a bid to increase India’s daily intake of these fresh farm items to the level of WHO recommended quantity of 400 grams per person.

The survey covered 1,001 respondents in five cities — NCR region, Delhi, Mumbai, Chennai, Hyderabad and Kolkata — to learn the consumption of fruits and vegetables in India.

The survey showed that the daily consumption of fruits and vegetables remained low at 280 grams per person despite India being the world’s largest producer of these items.

Lifestyle issues, seasonal availability, high cost, inconvenient market location, limited storage capacity at home among others were the reasons for low intake, it said.

To raise the consumption level, ICRIER Director and Chief Executive Rajat Kathuria said, “There is a need to identify gaps in food supply chain infrastructure and focus policy on the creation of the right infrastructure.”

Fruits and vegetables should be delisted from APMC so that there is no cess and remove restrictions on inter-state movements of fruits and vegetables, he suggested as per the media report.