Cabinet may decide on FDI in pharma, housing tomorrow
Dec 13, 2013
Source : The Economic Times

 

DELHI: The Cabinet is expected to take a decision tomorrow on relaxing FDI norms for the housing sector and reducing foreign direct investment cap to 49 per cent in critical areas of the pharma segment.

Several departments including the DIPP have raised serious concerns over continuous acquisitions of Indian drug makers by global multinational firms.

"The Cabinet will review the FDI policy in pharmaceutical and housing tomorrow," an official said.

The Department of Industrial Policy and Promotion (DIPP) has proposed to reduce FDI cap from 100 per cent to 49 per cent in the "rare or critical pharma verticals".

According to sources, three categories have been proposed to define "rare or critical". It includes companies with five or more manufacturing units, and companies with 40 per cent or more market share irrespective of the total number of manufacturing facilities.

"If an entity manufactures multiple products, it will be treated as critical if either of the above two conditions are satisfied for at least one third of the products," said a source.

The DIPP has also proposed to incorporate conditions for foreign firms like mandatory investment in R&D and non-compete clause in the shareholders pact.

The sources alsosaid the foreign company would not be allowed to close down the existing R&D centre and would have to mandatorily invest up to 25 per cent of the FDI in the new unit or R&D facility. The total investment, as per the proposal, will have to be incurred within 3 years of the acquisition.

There is thinking in the government that with MNCs taking control of Indian firms, there could be reduction in supply of vaccines, injectables, particularly for cancer and active pharmaceutical ingredients.

"MNCs which are acquiring domestic firms have spent less than one per cent of their total sales in R&D in India. They are doing only clinical trials in India and not actual drug development work," the source said.

In 2008, Japanese firm Daiichi Sankyo had bought out the country's largest drug maker Ranbaxy for $ 4.6 billion.

US-based Abbot labouratories had acquired Piramal Health Care's domestic business for $ 3.7 billion.

Currently, India permits 100 per cent FDI in the pharma sector through automatic approval route in the new projects, but the foreign investment in existing pharma companies are allowed only through FIPB's approval.

Regarding FDI in the housing sector, DIPP has proposed to relax FDI norms including easing conditions for exit before the three-year lock-in period. It has proposed easing conditions for exit of foreign players before the three-year lock-in period.

 

 

 

 

 

Latest Realty News

New formula for stressed road projects gets nod
Dec 13, 2013
DELHI: The highways ministry on Thursday accepted the formula proposed by a high-level panel for restructuring the annual premium owed to the government by developers of stressed road projects. The panel, headed by Prime Minister's Economic Advisory Council chairman C Rangarajan, had circulated its draft report earlier in the day. After receiving comments from the National Highways Authority of India, the Planning Commission and Department of Economic Affairs, the final report would be sent to f
Low income housing sector in India
Dec 13, 2013
DELHI: Low income housing sector has always been avoided by the big players in the real estate development business. Reason being the low margins, greater effort and set of skills which are different from what the traditional builders possess. These factors have kept away reputed builders from this sector. Tata Housing has its presence in this sector.
Raj Nagar Extension: A locality with potential
Dec 13, 2013
DELHI: Today, amongst places to invest in, Ghaziabad’s National Highway 58 is the most sought after. This stretch has been seeing a lot of development and has an investment potential. This stretch promises a lot for anyone looking for an affordable house. Many developers are coming up with their projects on this stretch, to meet the burgeoning demand of the middle class.
Greater Noida West: Emerging commercial and retail destination
Dec 13, 2013
DELHI : From the day of launch, ‘Greater Noida West’ is the affordable housing destination. But in the coming years, this location will play a major role in developing retail, commercial and IT/ITeS zone for millions too. Vikas Jain, managing director of Sarvottam Group shares his view point.
Panchsheel anounces the launch of ‘Pratishtha’
Dec 13, 2013
DELHI: Panchsheel Buildtech Pvt. Ltd, a leading real estate company of NCR has announced the launch of its prestigious residential project ‘Pratishtha’. Strategically located at one of the booming destinations of Noida, at Sector 75, the project is a perfect combination of modern, luxurious and comfort living.
Realtors queue up to make 12 lakh homes in Gurgaon
Dec 12, 2013
DELHI: With over 50 developers signing up to build affordable housing projects in new sectors, buying a flat in the city at a relatively economical Rs 12 lakh is set to become a reality. The low-cost housing policy project announced by the state government in August fixed the price of flats at Rs 43,000 per sq m with the sizes of flats ranging between 28 and 60 sq.m. The department of town and country planning (DTCP), Haryana, has set a deadline of four years from the approval of building plans
Work on Dwarka Expressway is set to resume
Dec 12, 2013
DELHI: Resumption of work on the much-delayed Dwarka Expressway is good news for the thousands of end users and investors here. The expressway has emerged as one of the most sought-after real estate destinations in the National Capital Region (NCR) today.
New land act will impact growth
Dec 12, 2013
DELHI: Land reform has been a neglected social agenda in India for decades, and sidelining this very important subject has come at an economic cost, particularly in recent times.
'Launch of new homes falls 12% in 8 cities this year'
Dec 12, 2013
DELHI: Launch of new homes dropped by 12 per cent to over 1.72 lakh units so far during this calendar year in the eight major cities due to cautious approach by developers in view of slowdown in demand, according to global property consultant Cushman & Wakefield.
Property launches down 12 per cent this year
Dec 12, 2013
DELHI: Across major cities, new property launches in the residential segment declined 12 per cent this year, with Chennai recording the sharpest drop at 39 per cent, followed by the Delhi National Capital Region (NCR) at 33 per cent, according to a report.

Latest Realty News Of State

Realty Talk's