Govt seeks views on allowing 74% FDI in defence production
Published on Mon, May 17, 2010 at 16:39 | Source : Moneycontrol.com
Updated at Tue, May 18, 2010 at 09:48
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Govt seeks views on allowing 74% FDI in defence production
Soon it may be a cheerful time for the defence sector of India with the foreign funds flowing in. The government has asked for views on allowing a 74% FDI in defence sector.
Soon it may be a cheerful time for the defence sector of India with the foreign funds flowing in. The government has asked for views on allowing a 74% Foreign Direct Investment (FDI) in defence sector, says Newswire-18. Currently, the defence sector has a FDI cap of 26%.
The move, if implemented, would boost domestic production of cutting edge weapons systems leading to employment and lower costs.
According to the document, opening up FDI will benefit indian defence PSUs as it will promote tie ups with foreign weapons manufacturers. The document also proposes that the foreign partners do not have to commit any domestic procurement but will have to participate in bids.
It is also expected to release similar discussion papers that propose to allow FDI in multi-brand retail.
However, the industry has been asking the government to allow 100% FDI in the defence sector in a view to give a boast to the domestic manufacturing units.
Earlier industry body Assocham had proposed that 49% FDI should be allowed in the sector, instead of 100%.
