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INDIA BUSINESS WORLD - September 1st - September 30th - 2008
FDI PROPOSALS WORTH RS 1,400 CR OKAYED
THE government has cleared 12 proposals involving foreign direct investment (FDI) of Rs 1,400 crore, including that of Goldman Sachs Group to set up a primary dealership firm in the country. Finance minister P Chidambaram on the recommendations of Foreign Investment Promotion Board cleared the proposals. Goldman Sachs (Mauritius) LLC plans to undertake the activities as a primary dealer.
A proposal by National Housing Bank, US-based United Guaranty Corp and International Finance Corp to establish a joint venture for undertaking mortgage guarantee activities in India was also cleared. The JV is set to bring in total FDI of Rs 570 crore. The JV will address the issue of loan defaults which would help banks spread lending activities across all segments and lower their risks.
The government also cleared a plan by Mumbai-based Polycab Wires’ to convert from an operating company to operating-cumholding company. This will enable Polycab to make downstream investment of Rs 551 crore and issue warrants.
ZF India’s proposal to manufacture chassis and driveline products for passenger vehicles and rail coaches also got the approval. The proposal will bring in FDI of Rs 224 crore.
However, Essel Shyam Communication’s proposal to acquire equity shares and issue warrants to subscribe to compulsory convertible preference shares was deferred. The proposal of ABNAMRO Securities (India) to offer value-added financial services (non-fund based) to its clients, both individual and institutional, was also deferred. The government rejected the proposal of JSW Infrastructure, which wanted ex-post-facto approval for having undertaken the activity of holding company.
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