FIPB, a national agency of Government of India, offered a single window clearance for applications on FDI in India. The sectors which came under the automatic method did not require any prior approval from FIPB and were subject to only sectoral laws. Secretary, Department of Economic Affairs, Ministry of Finance was the chairman of the board which consisted of 1. Secretary to Government, Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, 2. Secretary to Government, Department of Commerce, Ministry of Commerce & Industry, 3. Secretary to Government, Economic Relations, Ministry of External Affairs, 4. Secretary to Government, Ministry of Overseas Indian Affairs. The Board was empowered to co-opt other Secretaries to the Central Government and top officials of financial institutions, banks and professional experts of Industry and Commerce, as and when necessary.
The Union Cabinet has approved the abolition of the Foreign Investment Promotion Board. During the budget speech for the 2017-18 session, on February 1, Finance Minister Arun Jaitley had announced the scrapping of the 25-year-old inter-ministerial body. FIPB comes under the purview of the finance ministry’s department of economic affairs. It was first constituted under the PM office during the process of economic liberalization in the early 1990s. The job of the FIPB was to vet Foreign Direct Investment (FDI) proposals in India which went on the government’s approval route. It had the power to consider and recommend FDI. In the process of making recommendations, the FIPB provided inputs for FDI policy-making.India has opened up many sectors to enable foreign companies to set up shop in India, and that had reduced the utility of the FIPB.