NEW DELHI: The Indian government has approved Grey Worldwide India and B4U Multimedia International Limiter's proposals involving foreign investment and changes sought in earlier clearances.

B4U Multimedia proposals envisage transfer of shares from resident to non- resident shareholders against redemption of foreign convertible debentures (FCDs). The foreign direct investment component amounts to Rs. 5.4 million.

The company has submitted to the government that apart from undertaking activities in producing entertainment software, it also dabbles in e-commerce.

The clearances are part of a package okayed by finance minister P Chidambaram based on the recommendations of the Foreign Investment Promotion Board (FIPB) in its meeting held on 27 January, 2005. The total package approved by the FM amounts to Rs. 340 million.

These proposals relate to ministries/departments of Chemicals & Petrochemicals, Commerce, Industrial Policy & Promotion, Heavy Industry, Information & Broadcasting, Information Technology, Power, Telecommunications and Economic Affairs. The major investment proposals pertain to sectors like Steel and Trading.

In the case of Grey Worldwide India, active in the field of advertising, publicity, sales promotion, public relations, marketing and mass communications, permission had been sought for a change in the status of an erstwhile overseas corporate body (OCB) to a foreign company, envisaging no inflow or outflow of foreign exchange.

In the absence of detailed information till the time of writing this report, it is not clear whether the case of Grey Worldwide was necessitated after a global takeover of the company by the Sir Martin Sorrell-promoted WPP, one of the world's leading communications services groups, which through direct and indirect presence works with more than 330 of the Fortune Global 500 companies, over one-half of the NASDAQ 100 and over 30 of the Fortune e-50.