Reforms on the way in India?

From the Financial Times, via Daniel Drezner:

India's Communist-backed government will on Thursday afternoon consider a sweeping liberalisation of foreign direct investment rules that would kick start a long-stalled programme of economic reforms.

Kamal Nath, India's minister for commerce and industry, has proposed allowing 100 per cent foreign direct investment in a range of sectors, including airport construction, oil & gas infrastructure and cash & carry wholesale trading.

The cabinet will also debate whether to allow FDI in the exploration and mining of coal, lignite and diamonds, and in the cultivation of important plantation crops such as coffee, tea and rubber....

India attracted $5.5bn in FDI in 2004-5, an increase of 18 per cent, but less than a tenth of the inflows into China. The government estimates that $150bn needs to be invested in upgrading the country's infrastructure over the next 10 years.

Update: "India's Communist-backed government on Thursday night shied away from approving a sweeping liberalisation of foreign direct investment rules that would have kickstarted a stalled programme of economic reforms," via the FT. More comment on the decision.