Move allows companies easier access to Indian markets...
The Indian cabinet approved a bill allowing 100 per cent foreign direct investment (FDI) in the petroleum marketing business. This move should make it easier for multinational oil major Royal Dutch/Shell to set up retail operations in the country.
Shell had earlier sought relaxation from the Government to allow 100 per cent FDI in the retailing business as against the then prevailing limit of 74 per cent.
The other hurdle for Shell retail is meeting the qualifying requirement of Rs 2,000 crore investment in the petroleum sector. Shell has so far invested Rs 1,700 crore and hopes to achieve the required investment level in another three months' time.
Meanwhile, industry sources add that the Cabinet's move to allow 100 per cent FDI in refineries as well as pipelines is not going to find too many takers in the short term. In the refinery segment, there is surplus capacity in the country. In the exploration business, the Cabinet approved 100 per cent FDI.