Sharma releases ‘consolidated’ draft FDI policy

The government on Thursday released a draft of the consolidated foreign direct investment (FDI) policy, which among other things is aimed at making available all information on FDI policy at one place.

The draft consolidated document would be open for comments until 31 January 2010 and would take shape as an official document in the next fiscal year starting on 1 April 2010.

Releasing the draft, commerce and industry minister Anand Sharma said the FDI policy would be reviewed and updated every six months. ''It will lead to simplification of the policy, clearer understanding of foreign investment rules among foreign investors and sector regulators, and predictability of policy direction,'' Sharma told reporters in New Delhi on Thursday.

He however clarified that the new draft framework is just a consolidation of the previous FDI policy regulations and reflects the current regulatory framework. DIPP has not made changes in the extant regulations.

The government would continue to make changes to the policy through press notes whenever required. However, at the time of the six-monthly revision such changes would be incorporated in the compendium.

Sharma also released the latest FDI numbers, which show that India received $1.74 billion (about Rs8,000 crore) worth of FDI in November, up 60 per cent from a year ago. As a percentage of the gross domestic product, FDI equity inflows have grown from 0.75 per cent in 2005-06 to nearly 2.49 per cent in 2008-09.