India is exploring a proposal to cap foreign direct investment in drugmakers at 49%, and make additional stakebuys subject to government approval, to head off foreign takeovers, the Mint reported on Monday.
The newspaper said officials from the ministry of commerce and industry and the ministry of health have had multiple rounds of discussions on the proposal following a note written to them by the finance ministry in November.
Currently, foreign companies can purchase as much as 100% in a local drugmaker without prior approval of the Foreign Investment Promotion Board, a government body that scrutinizes investment proposals.
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