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Moumita Bakshi Chatterjee

New Delhi, Nov. 24 PepsiCo India Holding’s proposal for additional equity investment of $200 million in its Indian operations may get the green signal.

The Foreign Investment Promotion Board (FIPB), it is learnt, has recommended approval for PepsiCo’s investment plans, which are spread over three years. Sources pointed out that the proposal is yet to get the Finance Minister’s approval.

In addition, the proposal may also require the nod of Cabinet Committee on Economic Affairs (CCEA), sources said.

In 1994, PepsiCo India Holding was granted an approval to establish a 100 per cent holding company that would invest in an Indian subsidiary company or in a joint venture or directly engage in certain business activities.

The initial quantum of FDI was $95 million.

“The company would directly engage in manufacturing and distribution of beverages,” sources said.

Consequently through three amendment letters between 1995 and 1997, the FDI quantum rose to $180 million, to $225 million and to $405 million.

In 2009, it was granted approval to raise the amount by another $50 million to $455 million to be subscribed to PepsiCo Inc US or its subsidiaries, sources said.

The company has now said that with a view to meet its investment plans over the next three years, it plans to bring additional capital to the tune of $200 million.

The latest application will take the company’s total investment to $655 million.

The proposal had been deferred in the last meeting of FIPB held on October 30.

At that time, DIPP and the Department of Economic Affairs had said they had no objections to the proposal.

However, the Department of Revenue had sought a deferment, following which the Board had put on hold a decision on the proposal.

More Stories on : Foreign Direct Investment | Beverages

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