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The government on Tuesday said series of steps like allowing foreign direct investment in multi-brand retail, power exchange and civil aviation will help in reviving investors’ confidence and boosting economy as a whole.
On September 14, the government allowed 51 per cent FDI in multi-brand retail, 49 per cent investment by foreign airlines in aviation sector and sale of equity in four public sector units.
“...these decisions are intended to revive investors confidence, revive downward trend of growth and provide the much needed momentum to the economy,” Secretary in the Department of Industrial Policy and Promotion (DIPP) Saurabh Chandra said here at a CII function.
He said these measures would boost both foreign and domestic investors’ confidence.
The big-bang reforms came at a time when the country’s economy grew by 5.5 percent in the April—June quarter this fiscal, the decade’s worst Q1 performance. Poor showing by the manufacturing sector has pulled down India’s GDP growth.
Foreign Direct Investment in the country too declined to $ 6.18 billion during April—July 2012 from $ 14.6 billion in the same period last year.
Chandra said in order to boost manufacturing sector in the country the government has announced national manufacturing policy (NMP) and are in process of implementing Delhi-Mumbai Industrial Corridor (DMIC) project.
The government has been taking several steps to increase the share of the manufacturing sector in the GDP to at least 25 per cent by 2020 from the present 16 per cent.
In this regard, NMP was announced which envisages setting up of National Manufacturing Investment Zones (NMIZs). These zones will be mega industrial zones with world class supporting infrastructure.
The government is offering a host of incentives like exemption from capital gains tax and a liberalised labour and environment norms to promote these zones. The NMP proposes to create 100 million jobs by 2020.
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