The Foreign Investment Promotion Board (FIPB) could be scrapped as early as next month and a decision in this regard could be taken at a Cabinet meeting on Wednesday, sources have told CNBC-TV18.
An inter-ministerial body, FIPB is the current nodal agency responsible for processing of foreign direct investment (FDI) proposals.
Currently, more than 90 percent of the total FDI inflows pour in through the automatic route, while FIPB or Cabinet approval is required in others.
Finance Minister Arun Jaitley had announced in the Budget for 2017-18 the government’s intent to abolish the FIPB and replace it with a new system as part of the government’s broader strategy to ease FDI rules, remove procedural delays and the turn India into a global investment hotspot.
A presentation will now be made to the Prime Minister on the proposed changes to the Foreign Direct Investment regime.
The Finance Ministry and Department of Industrial Policy and Promotion will also meet regarding the FDI changes on Wednesday before a Cabinet note is prepared.
FIPB, comprising officials from department of revenue, economic affairs and department of industrial policy and promotion (DIPP), among others is currently consulting concerned sectorial ministries, which attract maximum FDI.
In the absence of FIPB, nodal ministries will take a call on foreign investment going forward.
Commerce and Industry Minister Nirmala Sitharaman had earlier said that eliminating FIPB will further improve ease of doing business and the respective ministry regulators are sufficient to take care of investment proposals.
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