The proposal was part of the 26 proposals cleared by the FIPB at its meeting on Monday envisaging a foreign direct investment worth Rs 202 crore. The board also gave a nod to Isvor-Fiat to acquire the entire stake holdings of Fiat group of companies in the country and convert its 65:35 joint venture into a 100 per cent subsidiary, sources said.

The change in the stakeholding however, would not result in any alteration in the original equity base of $0.5 million of Isvor-Fiat, sources added. Isvor-Fiat India would acquire the stakes held by Fiat group companies including Fiat India Auto and Magneti Marelli, they said.

The board also cleared Modi Xerox's proposal to restructure its operations and convert its subsidiary offering financial services into a non-banking financecompany, sources further said.

FIPB further cleared the application put in by Netherlands-based Madisson Square Holdings, which is a subsidiary of Reckitt and Coleman, for setting up a 100 per cent-owned subsidiary in the country at an investment of Rs 33.6 crore, sources said. According to the proposal Madisson plans to manufacture and market polishes and toilettery products in the country, they added.

The other proposals cleared included, Natarajan Ramaiah's, an NRI, application to set up a Chennai-based entertainment complex at an investment of Rs 77.5 crore. The venture would have 49 per cent foreign equity while, the remaining would be held by Ramaiah. The complex would have a bowling alley, restaurant, multiplex cinema theatre and sightseeing and tour operators.

In the software and electronics sector the FIPB approved six proposals including that of MCS Software Solutions, India Interistech, Nichin Software, Tumlare, DTS Information Systems and Math Engines.

UAE-based Rose Corner Trading hasalso been permitted to hike its equity holding in Magnum Papers from 74 per cent to 89 per cent by infusing further Rs 25.24 crore, sources said.

The FIPB however, deferred decision on the proposals of SHV Energy, JT Mobiles and Woolmark. The board also rejected the application of De Nocil Crops and KSM Ingenieurgemeinschaft Gmbh, sources added.

The board cleared Lakhanpal National's application to extend its technical collaboration agreement with Matsushita Battery and Matsushita Electric of Japan for a period of five years on the same terms and conditions of royalty payment. The company manufactures zinc chloride mercury free battery.

FIPB also gave a green signal to Japan-based Ikegawa to hike stake in its existing venture with Sona for making precision gears from 30 per cent to 31.2 per cent. Owari Products of Japan will also be inducted into the venture, sources added.