FDI security review: What experts think of govt’s approach
By admin at 12 March, 2010, 12:39 pm
Following exhaustive inter-ministerial consultations, the government has finalized a new approach to manage security concerns with regard to inflows via foreign direct investments. The new approach aims for surveillance of all investments while trying to avoid the need for umbrella security legislation.
A full disclosure of all details will be mandatory at the application stage. The Department of Industrial Policy and Promotion (DIPP) and the Ministry of Home Affairs (MHA) will have to prepare a new format for FDI applications.
Press Note 3 2009 is to be reviewed by the DIPP, Ministry of Corporate Affairs, Law Ministry, and the Ministry of Finance. This will include a safeguard clause. The review will address issues of ownership and control by foreign entities.
Prior MHA security nod would to be mandatory for all approvals. It would review and recommend a list of new sensitive sectors. Security rejected cases can be reviewed on request. While issues related to imported equipment security are to be dealt with separately.
source : moneycontrol
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