Will global investors come to economy's rescue?
Giving the economy respite
The government, on Wednesday, allowed foreign direct investment (FDI) coal mining, contract manufacturing and digital media, while easing rules for single-brand retail to make it attractive for global brands to invest in the country. These moves are aimed at providing a boost to a slowing economy and spurring investment.
Uniqlo, IKEA and their likes to benefit
Easier rules in single-brand retail will help international players such as Japanese retailer Uniqlo, which can now hope to undertake online sales for two years while it opens its retail outlets. Swedish furniture and household goods retailer IKEA, for instance, could not undertake online sales till it opened its first store in Hyderabad recently.
Apple will also take a bigger bite
Similarly, by allowing 100% FDI in contract manufacturing, the government is hoping to attract investment from companies such as Apple that has so far stayed away from India, demanding special sops.
More global giants to follow
The change in the rules for coal mining is expected to open the doors for the entry of global giants such as BHP Billiton, Shenhua Group and Anglo American Plc who will now be allowed to sell coal that they mine apart from handling, separation, washing and crushing.
Highlighting India on the map
Experts say some of these moves can help India attract more high-profile businesses apart from making Indian companies a part of the global value chain. The steps come at a time when international players are looking at expanding their footprint beyond China. The move to treat exports from India as part of the domestic sourcing obligation is meant to help companies build larger capacities looking at not just the domestic but also the global market.