India eases foreign investment rules to boost growth

Fruit seller on the phone Foreign investment is seen as key to boosting growth in India's slowing economy

Related Stories

India has further eased rules on foreign direct investment in a range of industries in an attempt to support the sliding currency and boost growth.

Senior cabinet ministers and Prime Minister Manmohan Singh approved the plans at a meeting late on Tuesday.

The move will allow 100% foreign ownership in the telecommunications industry, up from 74% at the moment.

The reforms still need clearance from the full cabinet.

In September last year, the government announced the opening up of India's huge retail sector to foreign supermarkets, which led to protests in the streets from small shop owners.

Tuesday's move would allow companies such as Britain's Vodafone Group and Norway's Telenor ASA to operate in the country without the need to partner with an Indian company.

Restrictions in a dozen other industries including insurance and tea plantations would be relaxed or abolished, said Commerce Minister Anand Sharma.

"We expect more foreign direct investment to flow in with these decisions," Mr Sharma said at a press conference.

In the defence sector, the cap for foreign direct investment will remain at 26% but proposals beyond that will be assessed on a case-by-case basis.

Economist say attracting investors is key to bolstering India's economy, which expanded at its slowest pace in a decade.

The Indian rupee has fallen in value to record lows in recent weeks, hitting an all-time low of 61.21 against the US dollar.

More on This Story

Related Stories

More Business stories

RSS

Features & Analysis

  • Cartoon of women chatting on the metroChat wagon

    The interesting things you hear in a women-only carriage


  • Replica of a cargo boxSpecial delivery

    The man who posted himself to the other side of the world


  • Music scoreFinal score Watch

    Goodbye to NYC's last classical sheet music shop


  • Former Secretary of State Hillary Rodham Clinton checks her Blackberry from a desk inside a C-17 military plane upon her departure from Malta, in the Mediterranean Sea, bound for Tripoli, Libya'Emailgate'

    Hillary gets a taste of scrutiny that lies ahead


From BBC Capital

Programmes

  • A cyborg cockroachClick Watch

    The cyborg cockroach - why has a computer been attached to this insect’s nervous system?

Try our new site and tell us what you think. Learn more
Take me there

Copyright © 2015 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.