Prime Minister Manmohan Singh will on Tuesday discuss the proposal to hike foreign investment caps in sectors like telecom, retail and defence with his senior Cabinet colleagues.
The other issue which will figure in the meeting is the concerns raised by the Commerce and Industry Ministry on the increasing number of acquisitions of domestic pharmaceutical companies by foreign firms, an official said.
The Department of Industrial Policy and Promotion (DIPP) has raised concerns over a spate of acquisitions of domestic pharma firms by multinationals. It has sought the intervention of the Prime Minister's Office (PMO) on this matter.
"All the FDI related matters are expected to be discussed in the meeting," the official said.
Besides, Commerce and Industry Minister Anand Sharma and Finance Minister P Chidambaram are expected to attend the meeting.
Seeking to promote India as an investment destination, the Finance Ministry last month proposed sweeping changes in the FDI regime, favouring higher sectoral caps in almost all sectors including defence, multi-brand retail and telecom.
Virtually doing away with the 26 per cent ceiling, a committee headed by Economic Affairs Secretary Arvind Mayaram has recommended that FDI limit be raised to 49 per cent in almost all sectors through automatic route.
The committee has suggested that FDI in defence be raised to 49 per cent under the government approval route, from 26 per cent at present.
Besides, it has proposed to increase FDI cap to 74 per cent and 100 per cent in multi-brand retail trading and telecom sector.
Recently, Sharma and Chidambaram were on a four-day visit to the US to woo foreign investments.
FDI inflows in 2012-13 aggregated USD 22.42 billion, a decline from USD 36.50 billion in 2011-12.