A day after, the Union Cabinet led by Prime Minister Narendra Modi announced the opening of big-bang Foreign Direct Investment (FDI) route for debt-laden Air India, Anand Mahindra lauded the decision, saying it was a move contrary to the “widespread apprehension” the government will take “populist” moves.
The Union Cabinet on Wednesday took a slew of decisions, including the FDI reforms in key sectors: Air India, Single Brand Retail Trading, Construction and Power. The government approved the foreign direct investment of up to 49% under approval route in Air India, which is being lauded by not just Anand Mahindra but other industrialists too.
Anand Mahindra, the chairman of the Mahindra Group, retweeting the news of 49% FDI in Air India, said: There is widespread apprehension that the Govt is getting into election mode & will now undertake only populist moves & avoid potentially controversial reforms. I applaud this move because it clearly indicates the contrary….
Last June, the Cabinet approved disinvestment of Air India. The government, since then, has been slowly and systematically going forward with the plan, with Tata Group, IndiGo and Bird Group expressing interest in either buying the troubled national carrier or buying parts of it. The 49% FDI decision would pave the way for Indian players such as Tatas to join hands with foreign entities in bidding for Air India.
Meanwhile, the decision was also welcomed by DLF’s Rajeev Talwar, who said that it will help India to achieve its $10 trillion-dream sooner. “Promoting investments from abroad will help India leap to the $10 trillion-economy soon. The inflow of foreign funds will help Companies under debt,” he told BTVi.
The government also relaxed foreign direct investment (FDI) policy for medical devices and audit firms associated with companies receiving overseas funds. The decisions will give a boost to foreign retailers like Ikea as the government approved 100% FDI under the automatic route for single-brand retail trading. Earlier, too, 100% FDI was allowed in the segment, but it required government approval.