Govt to take up decision on easing FDI norms for housing today

The Cabinet note has proposed a change in the current minimum built-up area of 50,000 sq mts to 20,000 sq mts of carpet area for FDI in construction development projects. The note also has suggested a uniform minimum capitalisation of 5 million for wholly-owned subsidiaries WOS and joint ventures with Indian partners. At present,the capitalisation requirement for WOS is 10 million.

The note suggests more relaxations on exit of FDI before the three-year lock-in period. They can exit on receipt of occupancy and or completion certificate issued by the competent local authority or by way of sale to another non-resident investor subject to a lock-in period of three years from the date of the purchase by the other foreign investor,a source said.

However,the transfer from foreigner to another will be permissible only once,with no possibility of waiver of the fresh lock-in period.

Sources also said the Cabinet may discuss the matter of FEMA Acquisition and Transfer of Movable Property in India law of May 2000.

Sources said the minimum area,minimum capitalisation and relaxation in the conditions of three-year lock in period would not apply to urban renewal projects and integrated slum development projects as defined under the JNNURM and Rajiv Awas Yojna RAY.