FIPB the two-decades-old body that was formed as a leading becon of the economic liberalisation of 1993 will be phased out.
The 93 round of reforms under the P.V. Narasimha Rao regime, for the first time, opened doors to foreign investors.
A major announcement in the budget was the abolition of the FIPB.
Single-window clearance has been put in place for applications of prospective foreign investors in sectors falling in the approval route.
The board has also suggested investment proposals worth up to ₹ 5,000 crore.
FIPB was formed under the PMO in the mid 1990s as part of the leading round of Indian economic reforms.
It was reconstituted in 1996 and transferred to DIPP. It has been under DEA under the Ministry of Finance since 2003.
According to government rules, foreign investments in sectors under the automatic route do not require prior approval from the FIPB and are subject to sectoral rules.
More than 90 percent of the total FDI inflows are now through the automatic route. The Foreign Investment Promotion Board has successfully implemented e-filing and online processing of FDI applications.
India has now reached a stage where FIPB can be phased out.
The decision has been made to abolish the FIPB in 2017-2018.
A roadmap for its abolition is to be announced in the next few months.
Government has shown its clear intent towards fast-tracking inflow of FDI, and the scrapping of FIPB is a notable step that would go a long way in improving ease of doing business.
GoI also plans to pursue more radical liberalisation in Foreign Direct Investment norms.
FIPB: Know More- The Foreign Investment Promotion Board (FIPB) was a national agency of Government of India.
- It was with the remit to consider and recommend foreign direct investment (FDI) which does not come under the automatic route.
- It used to act as a single window clearance for proposals on foreign direct investment(FDI) in India.
- FIPB is now abolished as announced by Finance Minister Arun Jaitley during 2017-2018 budget speech in Lok Sabha.
Members:- Secretary, Department of Economic Affairs - Chairman
- Secretary, Department of Industrial Policy & Promotion - Member
- Secretary, Department of Commerce - Member
- Secretary, (Economic Relation), Ministry of External Affairs - Member
