Will consult all ministries before hiking FDI cap: Sharma
Industries and Commerce minister Anand Sharma said that he will be consulting all the ministries before raising the limits on foreign direct investment (FDI) in the defence sector.
With Defence Minister A K Antony sharply opposing raising the FDI cap in the sector to 49 percent, Commerce and Industry Minister Anand Sharma today said the government will take into account views of all ministries before any liberalisation.
"This is a dialogue within the government. There is a view point which is in favour, Finance Minister and me and many of our colleagues have been in favour. But defence is a sensitive sector. Our aim is for a calibrated approach," he told reporters here.
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Sharma said nobody was opposed to induction of new technologies of manufacturing systems in the country and a consensus would happen when it is discussed.
"Defence we are not taking up unless and until the meetings are convened," Sharma said.
Antony in a letter to Sharma has opposed the Industry Ministry's proposal to hike Foreign Direct Investment (FDI) cap in the sector to 49 percent from the existing 26 percent.
"Allowing foreign companies to set up manufacturing assembly facilities here would be a retrograde step as it will stymie the growth of indigenous design and development, and our dependence on foreign countries and OEMs for modern weapons will get perpetuated," Antony wrote in the letter.
The Commerce Ministry has been pushing for hiking the FDI cap in defence sector from 26 percent. It had earlier proposed hiking it to 74 percent but apparently due to Defence Ministry's tough stand on the issue, it has now proposed it to be 49 percent.