INDIA BUSINESS WORLD - OCTOBER 2006
THE MONTH THAT WAS...

UK'S ALPHA AMONG 896CR FDI CLEARED

  FINANCE minister P Chidambaram has approved 22 foreign direct investment (FDI) proposals totalling Rs 896 crore, including major investments by Singapore-based Solitaire Capital and UK-based Alpha Airports. Solitaire's proposal worth Rs 511 crore relates to the real estate sector.

   According to a finance ministry statement, Singapore-based Solitaire Capital Investment's plans for downstream activities in real estate have been approved. The company will accept foreign contributions through the venture capital fund route to make investments in real estate development projects.

   UK-based Alpha Airport Group's proposal to establish a wholly-owned subsidiary for setting up duty-free shops, flight kitchens and food and beverage outlets at airports in the country at an investment of Rs 22.5 crore was also cleared. Government sources said Alpha would now have to obtain separate clearances from the concerned authorities for duty-free shops. In the case of flight kitchens, the company would have to go through the Reserve Bank's automatic route for FDI.

   Alpha's investment plans had turned controversial due to political opposition but the finance ministry has not overturned the recommendations of the Foreign Investment Promotion Board (FIPB). The UKbased company has tied up with Pantaloon for its India foray.

   Investments totalling Rs 307 crore have been cleared for the development of multiple power plants by KSK Energy Ventures. The company has created a holding company in the name of Bharat Bijlee Holdings for routing foreign investment from Mauritius to India. A wholly-owned subsidiary will be set up to invest in power projects across the country.

   The ministry has also cleared Spanish designer brand Lladro's proposal to set up a retail unit with 26% FDI initially, which will be raised to 49% subsequently under the single-brand retail policy.

   In the telecommunications sector, Global Communication Services Holding has got an approval for the change in its equity structure in Aircel Cellular, which has FDI to the tune of 74%. In the auto sector, the ministry has given approval to NSK of Tokyo to undertake manufacture of hub unit and magnetic clutch bearing.