The proposals of General Motors India Ltd, GE Caps, Tata Electric, Sumitomo Corporation, Denso Corporation of Japan and Thomson Electronics were also approved. VSNL's proposal would now go to the Cabinet Committee on Foreign Investment (CCFI) for final approval.

VSNL's $400 million issue also has a greenshoe option of $11 million. The department of economic affairs in the finance ministry has already given its in-principle approval to the issue and roadshows for the same are expected to begin soon. VSNL plans to issue 10 million shares not exceeding 52.86%.

GMI has been permitted to hike the lump sum royalty payment to its parent General Motor Corporation of the US while Sumitomo has got the nod for pumping in fresh equity to the tune of $6 million in its existing 100 per cent subsidiary. TataElectric Company's application proposed a foreign direct investment of Rs 425 crore for setting up of a Rs 2,350 crore LNG terminal from total gas and power at its power plant in Trombay, Maharashtra. The foreign partner would have a 50 per cent equity stake. Denso Corporation has been allowed to invest Rs 7 crore for setting up a 100 per cent subsidiary for assisting, advising and supporting and providing after sales services to their clients.

The FIPB has cleared UK-based National Power's proposal to set up a 100 per cent owned subsidiary for providing consultancy in power sector with an investment of Rs 21.25 crore while CMS Energi of the US has been allowed to set up a wholly-owned subsidiary for consultancy in engineering projects with FDI of Rs 210 crore.

Philip Morris to seek clearance

NEW DELHI: The Foreign Investment Promotion Board (FIPB) will take up the proposal of cigarette major Philip Morris' to set up a wholly owned subsidiary in India. Philip Morris has made the proposal throughits Swiss subsidiary, FTR Holding SA.

FTR plans to invest Rs 320 crore ($75 million), which will have a foreign equity component of Rs 160 crore. The remaining Rs 160 crore will be debt. The proposed subsidiary will act as an operating company to establish a research and technical services centre to improve tobacco leaf yield and quality, establish a tobacco processing plant to produce cut tobacco in bulk and sell cut tobacco products in bulk to licensed cigarette manufacturers. The company's proposal mentions that in its worldwide experience as long term investors, the company and its affiliates often invest greater sums than originally projected as it expands initial facilities.