The Supreme Court Monday gave the Reserve Bank of India (RBI) two weeks to amend its regulation to lift the cap on FDI in retail and aviation sectors under its policy permitting and regulating foreign investment in the country.
The apex court bench of Justice R.M. Lodha and Justice Anil R. Dave gave the RBI two weeks’ time after Attorney General G.E. Vahanvati told the court that the apex bank has already set into motion the process of amending its regulation on permitting foreign direct investment in the said sectors.
While not allowing the plea of lawyer M.L. Sharma, who filed a public interest litigation, to restrain the government from taking any action in pursuance of its decision till the RBI amended its regulation, the court said, “It is not as if they (central government) have kept the RBI in dark” about the decision.
The court also took note of the submission by Vahanvati that the RBI has already issued a circular in pursuance of the government decision to permit FDI in new areas.