The Foreign Investment Promotion Board, which approves foreign direct investment proposals that do not fall under automatic route, is likely to be wound up with the finance ministry deciding to reduce the number of bureaucratic layers in the decision making process.

However, the finance ministry is yet to apply its mind on whether to merge the interim Pension Fund Regulatory and Development Authority with Insurance Regulatory and Development Authority or have two separate regulators for pension and insurance.

But FIPB, which was shifted from industry ministry to finance ministry in 2002-03, may be scrapped as Finance Minister P Chidambaram is believed to have expressed the desire to expedite FDI clearance at the department level itself, official sources said.

At present, the Department of Industrial Policy and Promotion under commerce & industry ministry clears FDI proposals and then it is vetted by FIPB before a final approval by the finance minister.

The FIPB was shifted to the finance ministry when Arun Jaitley took over as commerce minister in place of the then ailing Murasoli Maran.

However, the finance ministry now wants FIPB to be wound up altogether as it only delayed the process of FDI clearance.