New Delhi: The Department of Industrial Policy and Promotion (DIPP), a nodal agency for matters related to FDI, has opposed a proposal of the National Security Council to set up an additional filter besides FIPB for clearing the FDI applications, sources said.
“They (NSC) are saying there should be more channels to clear FDI proposals but then, what would be the role of Foreign Investment Promotion Board (FIPB), it may become redundant,” a source said.
At present, FDI proposals are cleared by the finance minister on the recommendations of the FIPB, which has representatives of different ministries.
The National Security Council, an advisory body relating to national security issues, reports to the Prime Minister.
The council has raised concerns over flow of funds from inimical forces into the nation masquerading as FDI in sensitive areas of defence, telecom, pharmaceutical and airports.
The DIPP, a nodal agency under the Commerce and Industry Ministry for matters related to FDI, has strongly advocated that creating another layer of clearance mechanism would result in delays.
The department is keen on promoting India as a foreign investment destination. At the policy level, it has taken an initiative to frame a single composite document to remove procedural bottlenecks.
Even in the midst of financial crunch since September 2008, FDI inflows have been stable around USD 27 billion dollars annually.