The Hindu : Business : Nod for Fiat, Essar Comm. FDI

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Thursday, Nov 30, 2006
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Nod for Fiat, Essar Comm. FDI

Special Correspondent

Non-residents to invest Rs. 1,090 cr. in ICICI Venture Fund

NEW DELHI: The Union Government has permitted Fiat, the Italian car manufacturer, to bring in an additional Rs. 2,000 crore in foreign direct investment (FDI) to revive its languishing Indian subsidiary, Fiat India.

As per the proposal approved, Fiat Auto SpA of Italy is to pump in another Rs. 2,000 crores in Fiat India. The Cabinet Committee on Economic Affairs (CCEA) had earlier given the go-ahead for hiking the FDI portion from Rs. 2,000 crore to Rs. 4,000 crore to revamp its plant based in Pune. The loss-making Indian subsidiary had recently announced a tie-up with Tata Motors to achieve synergies in operations and joint development of models.

Among the 17 FDI proposals worth Rs 3,536.40 crore, which were cleared by Finance Minister P. Chidambaram on the recommendations of the Foreign Investment Promotion Board (FIPB), the second major approval pertains to an investment of Rs. 1,090 crore by non-resident Indians (NRIs), people of Indian origin (PIOs) and other overseas entities in ICICI Venture Funds Management Company.The ICICI Venture Funds proposal is aimed at launching an `India Advantage Fund' .

Mauritius-based Essar Communications has been permitted to invest Rs. 230 crore for acquiring an additional 5.85 per cent stake in Hutchison Essar. Yet another approval pertains to the Korea-based Mando Corporation bringing in Rs. 103.40 crore to set up a wholly-owned subsidiary in Chennai.

The subsidiary is to be engaged in the manufacture, marketing and distribution of power steering systems for Hyundai Motor India Ltd. and other auto companies.

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