Recently Foreign Investment Promotion Board FIPB was abolished Consider the following statements abo...........

Economic Affairs Foreign Investment

Recently, Foreign Investment Promotion Board (FIPB) was abolished. Consider the following statements about FDI approving authorities after abolition of FIPB

1. FDI from Pakistan and Bangladesh has to be approved by the Ministry of Home Affairs

2. Foreign investments by non-resident Indians has to be approved by Department of Industrial Policy and Promotion (DIPP)

Select the correct statements

1 only

2 only

Both

None

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Explanation:

FIPB was an inter-ministerial body housed in the Department of Economic Affairs in the finance ministry responsible for processing foreign direct investment (FDI) proposals and recommending for approval to the finance minister and subsequently to the Cabinet Committee on Economic Affairs if the investment amount exceeded Rs3,000 crore.
Now individual departments of the government have been empowered to clear FDI proposals in consultation with DIPP which will also issue the standard operating procedures for processing applications.
All FDI from Pakistan and Bangladesh and FDI proposals requiring approval of private security agencies and manufacture of small arms will require to be approved by Ministry of Home Affairs. While foreign investments by non-resident Indians and FDI in retail and export oriented units will be approved by DIPP, FDI in banks will be approved by the Department of Financial Services. DIPP or Department of Economic Affairs will undertake a quarterly review of FDI proposals.
Financial Services not regulated by a regulator or where there is more than one regulator or in respect of which there is a doubt about the regulator will be approved by Department of Economic Affairs, Ministry of Finance.
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