The Foreign Investments Promotion Board has approved ICICI''s plan to raise $500 million (Rs 2,150 crore) fresh equity through the global depository/American depository receipts to finance its growing lending requirements. The infusion of equity will enable the financial institution to borrow up to ten times the equity level for purposes of lending.

ICICI''s proposal to increase its equity was earlier opposed by other financial institutions, including LIC, UTI and GIC. They had feared that their combined stake of 29 per cent in ICICI would be scale down, thus depriving them of their powers to block special resolutions. However, ICICI will make a preferential issue to these institutions so that their stake is kept intact.

The FIPB at its meeting on 9 August also approved a proposal from Daewoo Motors India Ltd to bring in foreign investment worth $100 million. With this fund infusion, the parent Daewoo group''s stake in the Indian unit will rise to 96 per cent from the present 92 per cent. The funds will be utilised to reduce debt and to launch new car models.

The other two important proposals among the 45 are:

Otis Elevators of the US has been permitted to buy out the 23.8 per cent stake of Mahindra & Mahindra in Otis Elevators India. The US company will bring in foreign exchange equivalent to Rs 112 crore to increase its stake from 45 per cent to 68.8 per cent.

Mitsubishi Corporation of Japan has been allowed to withdraw its earlier proposal to take a 10 per cent stake in Hindustan Motors for manufacturing the Lancer car. Mitsubishi will, however, continue to be technical collaborator in the venture.

The FIPB once again deferred its decision on an application from Pfizer of the US to set up a wholly owned subsidiary to manufacture new high-tech formulations and leverage the parent company''s global technological and marketing strengths.