The Cabinet is likely to approve a proposal to allow foreign direct investment (FDI) in Limited Liability Partnership firms on Wednesday. "The proposal to allow FDI in LLPs in on the agenda of the Cabinet. It is likely to be approved," a source said.

The move will enable LLPs to choose among domestic and foreign investors and make these more competitive. This will also encourage more partnership firms to convert into LLPs. LLP is a new business structure that has hybrid features of partnership firm and a corporate body -- a company's limited liability and the flexibility of a partnership firm. As on May 2, as many as 4,679 LLPs were registered with the Ministry of Corporate Affairs . (PTI)