Jan. 22 – India is considering relaxing norms for foreign direct investment to require that only projects worth about US$217 million to US$326 million will need final approval from the Cabinet Committee on Economic Affairs (CCEA).

Currently, projects worth more than US$130 million need to cleared with the Finance Minister, the Foreign Investment Promotion Board and the CCEA. If the proposal is approved the new conditions will probably be enforced after the introduction of the consolidated FDI policy framework set for April and projects worth below the threshold will no longer be required to gain CCE approval.

A senior Department of Industrial Policy and Promotion official told Business Standard that raising the threshold would augment greater FDI inflows into the country and minimize the role of CCEA. “The proposal has been in works for some time, but we plan to introduce it when the consolidated FDI policy framework comes into effect and we receive stakeholders’ views,” said the official.

While more foreign investments have been coming into India in the past years, it does play an important role in providing capital.  The new FDI policy changes hopes to change that with the goal of attracting US$50 billion in annual FDI by 2012.