The Centre on Wednesday announced a big foreign direct investment push in single-brand retail, coal mining and manufacturing to boost the economy, NDTV reported.
Commerce and Industry Minister Piyush Goyal said 100% foreign direct investment under automatic route in coal mining and associated infrastructure, and contract manufacturing were approved at a Cabinet meeting chaired by Prime Minister Narendra Modi, PTI reported.
Digital media companies, which did not have any FDI limits earlier, can now have 26% foreign stakes upon approval. “The FDI policy has historically been silent on digital news media – it just operated with a 26% for print [media] and 49% cap for television [news],” Vivek Gupta, partner at KPMG, told Bloomberg. According to the government statement, the FDI limit will apply to “uploading/streaming of news and current affairs through digital media”.
The Cabinet expanded the definition of mandatory 30% domestic sourcing norm for foreign direct investment in single-brand retailing, Goyal said. Single-brand retailers can now start online sales after the government waived the previous condition of setting up a mandatory brick-and-mortar store.
Foreign direct investment equity inflows fell in the 2018-’19 financial year for the first time in six years. According to data released by the Department for Promotion of Industry and Internal Trade in May, FDI inflows declined 1% to $44.4 billion.
Union Information and Broadcasting Minister Prakash Javadekar, who addressed the media before Goyal, said the government would start 75 new medical colleges in the country, The Indian Express reported. The colleges will be opened in unreserved districts at a cost of Rs 24,375 crore and will add 15,700 more MBBS seats. This was the biggest expansion in medical education, the minister added.
The government also announced a Rs 6,268-crore subsidy for export of six million tonnes of sugar in the 2019-’20 marketing year, starting October, to liquidate surplus domestic stock and help mills clear huge sugarcane arrears to farmers, PTI reported. A lump sum subsidy of Rs 10,448 per tonne will be paid to sugar mills, he added.
According to Javadekar, the move will benefit millions of farmers in states such as Uttar Pradesh, Maharashtra and Karnataka.
These decisions came days after the Reserve Bank of India transferred Rs 1.76 lakh crore to the government. Finance Minister Nirmala Sitharaman on Tuesday said the government was not yet sure how it would utilise the money. Last week, the minister had announced a slew of measures to boost the economy, less than two months after presenting the Union Budget.
In recent weeks, a number of Prime Minister Narendra Modi’s top economic advisers have warned of a structural slowdown in the Indian economy and urged it to enact reforms.
Economic growth slipped to a five-year low of 5.8% in the January to March quarter. This was the slowest pace of growth in 17 quarters. A number of economists have also raised questions about the methodology of assessing official growth numbers. The automobile sector and biscuit makers have reported a slowdown in sales. Steelmaker JSW Steel has also said the industry may be forced to cut its production in the future because of falling consumer demand.
Corrections and clarifications: An earlier version of this article said the government had eased FDI norms for four sectors, including digital media. The article has been edited to state that no FDI policy existed for digital media earlier and the sector can now have up to 26% FDI.
Now, follow and debate the day’s most significant stories on Scroll Exchange.
Limited-time offer: Big stories, small price. Keep independent media alive. Become a Scroll member today!
Our journalism is for everyone. But you can get special privileges by buying an annual Scroll Membership. Sign up today!