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INX media scam

Date: 22 August 2019 Tags: Miscellaneous

Issue

 

 Former Finance Minister P Chidambaram was arrested by the Central Bureau of Investigation in relation to the INX Media case. 

 

Background

  • The CBI has registered an FIR alleging irregularities in Foreign Investment Promotion Board (FIPB) clearance given to INX media for receiving funds from abroad to the tune of Rs 305 crores.
  • It is alleged that Chidambaram received kick backs and tweaked FDI rules to allow excessive flow of foreign investments into INX media firm.

Details

  • According to ED, INX Media was granted permission by the FIPB for FDI inflow amounting to Rs 4.62 crore from three Mauritian companies into INX Media.
  • Instead of the approved Rs 4.62 crore FDI, INX Media brought in a much larger sum of Rs 305 crores. It then went a step further and even brought in downstream investments, clearly violating rules.
  • To facilitate changes, a bribe of $1 Million was transferred to Karti Chidambaram, son of P.Chidambaram through various foreign banks. The bribe amount was then used to buy various benami properties abroad.

Foreign Investment Promotion Board (FIPB)

  • The Foreign Investment Promotion Board (FIPB) was a national agency of Government of India, with the remit to consider and recommend foreign direct investment (FDI) which does not come under the automatic route.
  •  It was housed in the Department of Economic Affairs, Ministry of Finance. FIPB was abolished on 24 May 2017.