Government sources said among the measures being seriously considered is abolition of the dividend balancing condition on foreign companies. The commerce ministry has conveyed its concurrence to the abolition of restriction on repatriation of profits by foreign companies. At present, the dividend balancing condition requires companies in 22 industrial sectors with majority foreign equity to pay dividend out of exports. Foreign direct investors have been seeking abolition of the dividend balancing condition.

The dividend balancing condition was imposed in 1996 to prevent foreign exchange outflow from the country. But with the balance of payments condition fairly comfortable now, the case for removal of dividend balancing stipulation has become strong.

The automatic approval list is likely to be expanded and foreign investment upto 100 per cent may be allowed in certain sectors like petroleum and petroleum products.

The department of industrial policy and promotion in the industry ministry has also written to various ministries seeking a list of industries which they want to keep in the negative list.

Maran has held a series of meetings with top officials of the department in the last few days to discuss the policy initiatives the government needs to take for increasing FDI.

Government sources said the negative list was being drawn to ultimately pave the way for faster clearances of FDI proposals by transferring the powers to Reserve Bank of India.

Some ministries have already conveyed their comments on the negative list of industries to the department of industrial policy and promotion, sources said.

Policy guidelines on grant of licences for potable alcohol are also under review. Some foreign liquor companies have been lobbying hard with the union government to transfer the potable alcohol licence issuing powers to the state governments. Issue of licences for industrial alcohol and to companies which manufacture both potable and industrial alcohol are likely to be retained by the centre.