<p>The government on Friday set up a committee under a senior finance ministry official to create a new mechanism to approve foreign investments (FI) in the wake of the recent decision to abolish the Foreign Investment Promotion Board (FIPB).<br /><br /></p>.<p>“The committee under Saurabh Garg, Joint Secretary, Department of Economic Affairs, will come up with a new mechanism in six to eight weeks. In between at least two meetings of FIPB are likely to take place,” a government official said.<br /><br />Finance Minister Arun Jaitley in his Budget speech for 2017-18 had proposed abolition of FIPB since more than 90% approvals had turned automatic.<br /><br />“Under the new mechanism, things will be simpler. A clearing board will be made under the ministries concerned or departments to approve FDI proposals directly,” the official said.<br /><br />Currently, sectors like defence, telecommunications, financial services, retail and pharmaceuticals need approvals from FIPB.<br /><br />Phasing out of FIPB is likely to improve ease of doing business as FIPB, at present, takes six months or more to approve a deal.<br /><br />Informed sources said FIPB may eventually be merged with the Department of Industrial Policy and Promotion (DIPP) to formulate a comprehensive foreign direct investment policy.<br /><br />FIPB, which has started meeting twice every month since 2015, was created under the Prime Minister’s Office in the wake of economic liberalisation in the 1990s.<br /><br />The committee is expected to lay down a roadmap on the post FIPB scenario. The recommendations will be submitted for the government’s consideration by the beginning of the new financial year in April, the official said.<br /><br />He said FIPB will not only boost ease of doing business but also simplify procedures.</p>
<p>The government on Friday set up a committee under a senior finance ministry official to create a new mechanism to approve foreign investments (FI) in the wake of the recent decision to abolish the Foreign Investment Promotion Board (FIPB).<br /><br /></p>.<p>“The committee under Saurabh Garg, Joint Secretary, Department of Economic Affairs, will come up with a new mechanism in six to eight weeks. In between at least two meetings of FIPB are likely to take place,” a government official said.<br /><br />Finance Minister Arun Jaitley in his Budget speech for 2017-18 had proposed abolition of FIPB since more than 90% approvals had turned automatic.<br /><br />“Under the new mechanism, things will be simpler. A clearing board will be made under the ministries concerned or departments to approve FDI proposals directly,” the official said.<br /><br />Currently, sectors like defence, telecommunications, financial services, retail and pharmaceuticals need approvals from FIPB.<br /><br />Phasing out of FIPB is likely to improve ease of doing business as FIPB, at present, takes six months or more to approve a deal.<br /><br />Informed sources said FIPB may eventually be merged with the Department of Industrial Policy and Promotion (DIPP) to formulate a comprehensive foreign direct investment policy.<br /><br />FIPB, which has started meeting twice every month since 2015, was created under the Prime Minister’s Office in the wake of economic liberalisation in the 1990s.<br /><br />The committee is expected to lay down a roadmap on the post FIPB scenario. The recommendations will be submitted for the government’s consideration by the beginning of the new financial year in April, the official said.<br /><br />He said FIPB will not only boost ease of doing business but also simplify procedures.</p>
