New Delhi, March 29: The government today approved foreign direct investments worth Rs 7,800 crore, including the proposal of FMCG giant Reckitt Benckiser to invest around Rs 3,300 crore through a subsidiary to acquire Paras Pharmaceuticals.

“The approval is expected to result in FDI amounting to Rs 3,300 crore in the wholly owned subsidiary of Reckitt Benckiser Plc UK,” an official statement said.

Reckitt Benckiser will set up a wholly owned investing firm with 100 per cent foreign equity to buy Paras Pharma. In December, Reckitt had agreed to acquire the Ahmedabad-based company for Rs 3,260 crore.

The shares of the new subsidiary will be 100 per cent subscribed by Reckitt Benckiser (Singapore) and R&C Nominees Ltd.

The CCEA, headed by Prime Minister Manmohan Singh, also approved Hero Investment Private Ltd’s proposal to receive Rs 4,500-crore FDI from private equity firms Bain Capital and Lathe Investment.

Hero Investments had agreed this month to buy Honda Motors’ 26 per cent stake in Hero Honda Motors for around $851 million, leading to the Japanese auto maker exiting its joint venture in India after more than 26 years.

Textile modernisation

The government has enhanced the subsidy to modernise the textiles industry to Rs 15,404 crore from the earlier sanction of Rs 8,000 crore for the Eleventh Five Year Plan (2007-12).

The Centre has also approved a short-term loan of Rs 5,000 crore to the Food Corporation of India (FCI), which will help the organisation meet its working capital requirements this fiscal.

The FCI, the nodal agency for procurement and distribution of foodgrains, will repay the loan in the next fiscal.