During the first seven months of 2007, India received FDI inflows worth US$12.1 billion. This was more than the US$ 11.1 billion recived in the year 2006.

To expedite the clearance of FDI proposals, the Union government is likely to do away with the ongoing practice of the Cabinet Committee on Economic Affairs (CCEA) clearing foreign investment proposals valued over Rs. 600 crore, excepting proposals within sensitive sectors.

Under the current policy, the Foreign Investment Promotion Board (FIPB) clears those FDI proposals, which are not included under the automatic route. These proposals are sent to the CCEA, depending upon the size of their investment, and CCEA would take around 40-50 days to sanction its clearance.

As per the proposed new guidelines, the CCEA will clear FDI proposals only in sensitive sectors like Aviation, Telecommunications, Retail and Real Estate, in cases when the investment exceeds Rs. 600 crore.

In November 2007, the Union Ministry of Finance cleared a total of 34 FDI proposals worth Rs.738 crore, in two installments. On 02 November 2007, the Ministry cleared 12 FDI proposals worth Rs.211.66 crore. Of the 12, the largest proposal was that of US-based Millennium India Acquisition Company, who plans to invest Rs.159.92 crore in two non-banking finance companies.

Another prominent proposal to receive the government's approval was that of Mail Today newspaper, who intends to bring in fresh equity worth Rs.18.02 crore to acquire 26 per cent in a Living Media Group.

On 22 November 2007, the Finance Ministry cleared another 22 proposals involving FDI worth Rs.527.46 crore. The Ministry approved IFC proposals to acquire 18 per cent stake each in domestic stocks and in Angel Infin Pvt. Ltd., a commodities brokerage firm, by investing a total of Rs.152 crore. The government also allowed US-based Goldman Sachs and Australia's Macquarie to acquire 40 per cent stake at Rs.155.74 crore, in PTC India Financial Services Ltd, a non-banking financial arm of power trading firm PTC India Ltd,.

However, the government rejected Flemingo's proposal to open duty free shops outside airport premises and within hotels. The government also differed its decision on Dolce & Gabbana's proposal to set up a JV with a 51 per cent stake, in order to undertake single brand retailing of fashion and lifestyle products. The FIPB has also deferred a decision Russia's Sistema Joint Stock Financial Corp.'s proposal to increase its current holding in a telecom firm from 10 per cent to 74 per cent.

Press reports appearing in November 2007, suggested the government's intentions to allow 100 per cent FDI through the automatic route, to set up maintenance, repair and overhaul (MRO) facilities, flying training institutes, technical training institutes and helicopter or sea-plane operations.

Reports also indicated the government's intentions to retain the current 20 per cent FDI in radio companies and to allow an additional 6 per cent for foreign institutional investors and others.

Further, the government has reportedly decided not to raise the present cap of 49 per cent FDI in domestic airlines. Foreign airlines are, however, still barred from any direct or indirect participation in domestic airlines.