With an aim to boost manufacturing sector in the country, the Government has increased the validity of industrial licences to seven years from the existing validity period of three years. The Department of Industrial Policy & Promotion (DIPP) notified that as a measure of 'ease of doing business', two extensions of two years each in the initial validity of three years of industrial licence shall be allowed up to seven years. The government is currently working to promote India as a manufacturing hub with Make in India’ campaign, aimed at ensuring investor-friendly environment for businessmen in the country.
Furthermore, the DIPP also decided to deregulate the annual capacity for defence items for industrial licence to encourage more companies to enter the sector and allow manufacturers to scale up. However, the licensee shall submit half yearly production return to DIPP and Department of Defence Production (DoDP).
To ensure faster clearances, all applications related to DIPP will be processed within 90 days and in case of defence manufacturing, the ministry of home affairs will give security clearance within three months. To promote indigenization of India's defence production and to cut imports bill, the government has enhanced FDI limit to 49% from 26% in August. It also allowed more than one Indian company to hold a 51% share in a defence production company.