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New Delhi, July 14 (IANS) India and EU on Friday announced the establishment of an Investment Facilitation Mechanism (IFM) to promote investments from European Union, an official statement said.

“The mechanism will allow for a close coordination between the European Union and the India with an aim to promote and facilitate EU investment in India,” the Commerce Ministry said in a statement.

This agreement builds on the joint statement of the 13th EU-India Summit held in Brussels in March 2016, where EU had welcomed India’s readiness to establish such a mechanism and leaders from both sides had reaffirmed their shared commitment to oppose protectionism and to work in favour of a fair, transparent and rule-based trade and investment environment.

As part of the IFM, the EU Delegation to India and the Department of Industrial Policy and Promotion (DIPP) agreed to hold regular high level meetings to assess and facilitate “ease of doing business” for EU investors in India.

“This will include identifying and putting in place solutions to procedural impediments faced by EU companies and investors in establishing or running their operations in India,” the statement said.

“The establishment of the Investment Facilitation Mechanism is a right step in the direction of strengthening the trade and investment ties between the EU and India. The EU is the largest foreign investor in India and this initiative helps ensuring a more robust, effective and predictable business environment for the EU investors,” said EU Amabassador to India Tomasz Koslowski.

DIPP Secretary Ramesh Abhishek said: “Ease of doing business is a fundamental priority of government’s Make in India campaign and the establishment of IFM for facilitating EU investments in India is another step to achieve this goal.

“The IFM has been established with the key objectives of paving the way for identifying and solving problems faced by EU companies and investors with regard to their operations in India.”

The IFM, which will cover new investors as well as those already established in India, will also serve as a platform for discussing general suggestions from the point of view of EU companies and investors with regard to ease of doing business in India, to boost and encourage the EU investors to avail the investment opportunities available in India, he said.

Invest India, the official Investment Promotion and Facilitation Agency, will also be part of the Mechanism, which will create a single-window entry point for EU companies that need assistance for their investments at the central or state level.

The DIPP will also facilitate participation of other relevant ministries and authorities on a case-to-case basis.

Trade and investment are key elements of the EU-India Strategic Partnership launched in 2004. Along with being the first trade partner in goods and services, EU is one of the biggest provider of foreign investment in India, with a stock exceeding $81.52 billion (over Rs 4.4 lakh crores) as of March 2017.

There are currently more than 6,000 EU companies present in India, providing direct and indirect employment to over 6 million people.