FDI cap on defence production to stay at 26 percent
The cabinet Thursday decided that FDI cap in defence production will remain at 26 percent and proposals for higher foreign direct investment will be considered by the Cabinet Committee on Security (CCS) on a case to case basis.
An official release said that foreign direct investment in defence production above 26 percent will be decided on case to case basis if it ensures access to "state-of-art" technology.
"Up to 26 percent, no change i.e., through FIPB (foreign investment promotion board and CCEA (cabinet committee on economic affairs) if FDI exceeds Rs.1,200crore. Above 26 percent to CCS on case to case basis, which ensure access to modern and 'state-of-art' technology in the country," the release said.
The cabinet meeting was chaired by Prime Minister Manmohan Singh.
The government had last month cleared FDI in defence production beyond 26 percent on a case-to-case basis after approval of the CCS if the proposal involves state-of-the-art technology. †