The proposal to hike the upper limit of foreign direct investment (FDI) in various Indian sectors will likely come up before the Cabinet in the third week of July, Union Finance Minister P Chidambaram said.

In response to a query on when the govt. will take a call on increasing the FDI limit, Mr. Chidambaram said, "The FDI cap review may come up before the cabinet in the third week of July."

A committee headed by economic affairs secretary Arvind Mayaram recently proposed increasing of FDI limit in multi-brand retail and in telecom sectors to 74 per cent and 100 per cent, respectively. The committee also recommended full foreign investors' control on companies in aviation sector, internet service providers (ISPs), satellite, direct-to-home (DTH) services, cable networks, mobile television and private security agencies.

The high-level panel also proposed increasing of FDI cap the defence sector from current 26 per cent to 49 per cent.

The committee virtually suggested that the government should do away with the 26 per cent ceiling, and allow up to 49 per cent of FDI in nearly all sectors via the automatic route.

It may be noted here that FDI under automatic route does not require the government's or the Reserve Bank's permission. Foreign investors need to just notify the concerned authorities within one month of the receipt of funds.