It’s a move that will further liberalise foreign investment norms by cutting out red tape.
The government has drawn up plans to do away with the need for the Cabinet's approval for all FDI proposals of more than Rs 600 crore. 
The red carpet will hopefully now replace the red tape.
The ministry of commerce and industry has decided to modify the 1999 regulation that mandates Cabinet approval for large foreign direct investments (FDIs). 
The Cabinet nod is in addition to the approval required from the Foreign InvestmentPromotion Board (FIPB) and ends up delaying clearance of FIPB approved proposals by anywhere between 20-30 days.  
However, the move to do away with Cabinet clearance for FDI of more than Rs 600 will snip out one level of clearance and make the process of investing in India less cumbersome. It will reduce the noticed trend of FIPB cleared proposals being held up endlessly and enable the Cabinet to focus more on issues of national importance.
In the past, many big-ticket deals like Daiichi Sankyo-Ranbaxy, NTT Docomo-Tata Tele have been held up for Cabinet clearance even after they were cleared by the FIPB. A more recent instance is the Unitech Wireless-Telenor deal, which has gone to the Cabinet for clearance.
At a time when the economy is still recovering, removing needless hurdles to FDI is a sound policy approach. But will the Cabinet take as long in clearing the Commerce Ministry's proposal to relax these restrictions as it does to clear FDI proposals?