Raising of FDI Cap in Telecom Recommended

Steering Committee on FDI headed by N K Singh has recommended raising the FDI in telecom from the current 49% to 74%. The Government Working Group on Telecom Sector for the Tenth Five year Plan had clearly recognised that, to achieve the teledensity targets, huge funds of over Rs. 46000 crores would be needed by way of private sector investment. COAI has welcomed the recommendation. According to COAI "By recommending raising the FDI cap to 74%, the Steering Committee has thus provided for significantly increasing foreign investment inflows into the telecom sector which would go a long way towards funding the expansion plans as well as the setting up of new infrastructure by the telecom operators in a bid to facilitate the early achievement of the national objectives of improved tele density and increased rural connectivity for accelerated economic growth." According to a release "This welcome step will greatly facilitate accelerated growth of the telecom sector. "