The committee has expressed unhappiness over the manner in which the government has used the disinvestment proceeds. It feels that there is need for a mechanism to monitor the use disinvestment proceeds. Feasibility of handing over this job to disinvestment commission may be examined, it says. The committee says that it was given to understand that proceeds for disinvestment would meet the budgetary deficit and hence no clear idea was available on the use to which these funds were put to.

The committee has suggested that the government should set up a ``disinvestment fund'' into which all proceeds of disinvestment could be deposited and these funds should be used for industrialdevelopment of the country.

The committee has dwelled at length on the worsening investment climate in the country. It has said that the department of Industrial Policy and Promotion should initiate action to restore the confidence of investors and allay their fears regarding economic and investment climate in India.

``The need of the hour is to put the process of approving the FDI proposals particularly in infrastructure power, telecommunications on acceleration so that mood of the investor is not put off by the time he gets the nod to invest,'' it says. It stresses that this becomes all the more essential as the clouds of economic sanctions against India have begun to hover over the country.

On the role of the Foreign Investment Promotion Board the committee says that it has at present restricted its role to merely approving proposals. It says that it has not done any exercise on as to what happens after the proposal is cleared. ``What hardships an investor actually encounters after the approval stageis not being taken care of and the investor is left to fend for himself,'' it says.

It is a matter of regret that the FIPB has not undertaken any exercise to address these problems faced by investors, it says. Perhaps this could be the reason for the wide gap between the approval of proposals and the actual inflow of FDI, it says.

The report says that it has been eight years since foreign investments began to flow in, the picture that has emerged is not very encouraging. As against the total direct investment approvals worth Rs 1,60,255.44 crore the actual inflow of foreign investment stands at Rs 3,64,200.71 crore up to April 1998.According to the ministry of industry the total FDI proposals stand at 52 per cent whereas the actual inflow is even lower than that which is 22 per cent.