New Delhi: The Union Cabinet may soon decide on easing FDI norms for single-brand retailing, contract manufacturing, digital media and other sectors as the government is looking at ways to woo foreign investors.
The government on August 23 announced a host of measures such as the rollback of super-rich tax on foreign portfolio investors, exemption to startups from angel tax and fund infusion of Rs 70,000 crore into the banking system to assuage concerns of FPIs and other investors.
Under the single-brand retail proposal, players may relaxations in local sourcing norms. The retail players may also be allowed to open online stores before setting at brick and mortar stores, according to the proposal.
At present 30 per cent local sourcing is mandatory for foreign retail players. They are also required to open physical stores before starting their online ventures.
Other sectors where FDI rules would be eased are digital media, coal and contract manufacturing.
According to sources, the Union Cabinet would soon consider these issues for approval.
100% FDI in contract manufacturing
The government is considering permitting 100 per cent foreign investment in contract manufacturing.
The present policy is silent about FDI in contract manufacturing while 100 per cent FDI is allowed in manufacturing under the automatic route.
The government may clarify on the FDI in contract manufacturing as India is emerging as a contract manufacturing hub.
FDI norms for digital media
The Union Cabinet may also clarify the applicability of the FDI policy on the digital media sector.
The government allows 26 per cent FDI in the print media segment through the approval route and 49 per cent FDI in the broadcasting content services through the approval route. The policy is however silent on digital media segment.