The Union Cabinet is likely to do away with Foreign Investment Proposal Board or the FIPB. The decision comes a day after the CBI conducted raids at the residence of former union minister, P Chidambaram and his son Karti in connection with FIPB violations.
It may be recalled that the Arun Jaitley in his budget had said that keeping in mind the to make India an easier place to do business, reforms for foreign direct investment would include abolishing the FIPB, which is a part of the Finance Ministry.
The FIPB has five senior bureaucrats. The role of the FIPB is to consider foreign direct investments up to Rs 600 crore. Amounts larger than this need to be sanctioned by the cabinet committee.
The FIPB is likely to be abolished within the next month. The action would take place once the Cabinet formally approves of the same. Companies seeking approval may be asked to apply online through a new website that would direct their applications to the relevant ministry once FIBP is abolished. The Finance Minister had said a road map would be announced in the next few months for how applications for foreign investment would be handled.