FOREIGN FUNDS IN TELECOM / SEZS MAY BE SCREENED

The commerce ministry wants companies that are in the race to set up Special Economic Zones (SEZs) or to invest in telecom business, to disclose the extent and source of foreign direct investment proposed. This comes in the wake of increased security concerns of FDI inflows, especially with regard to telecom and port based SEZs. The Government has modified the checklist recently to include three parameters pertaining to FDI to be examined keeping in view:

• Extent of FDI
• Its source, and asking the applicant to reveal the country and name of the company bringing in the investment.

The Government has also made it mandatory for applicants who have proposed to set up telecom and port SEZs to confirm if the FDI is according to the norms of Press Note 5, 2005, which imposes various security related conditions”.