SUMMARY
The investment climate in India has improved ‘considerably since the opening up of the economy in 1991. This Is largely attributed to ease in FDI norms across sectors of the economy. With an aim to attract and promote FDI, Government of India (Gol) has put in place a policy framework on FDI, which is transparent, predictable and easily comprehensible.
India received record FDI of US$ 223 bn during 2014-18, in Sectors such as services, Computer software & hardware, Telecommunications, Trading, Construction attracted the highest FDI.
FDI ENTRY ROUTES
FDI under sectors is permitted either through Automatic route or Government route. Under the Automatic route, the non-resident or Indian company does not require any approval from GoI.
Whereas, under the Government route, approval from the Gol is required prior to investment. Proposals for foreign investment under the Government route are considered by the respective Administrative Ministry/Department FDI PERMITTED UNDER SECTORS AS PER FDI POLICY 2018.
100% AUTOMATIC ROUTE
Agriculture & Animal Husbandry, Air-Transport Services (non-scheduled and other services under civil aviation sector), Airports (Greenfield + Brownfield), Asset Reconstruction Companies, Auto-components, Automobiles, Biotechnology (Greenfield), Broadcast Content Services (Up-linking & down-linking of TV channels, Broadcasting Carriage Services, Capital Goods, Cash & Carry Wholesale Trading (including sourcing from MSEs), Chemicals, Coal & Lignite, Construction Development, Construction of Hospitals, Credit Information Companies, Duty Free Shops, E-commerce Activities, Electronic Systems, Food Processing, Gems & Jewelry, Healthcare, Industrial Parks, IT & BPM, Leather, Manufacturing, Mining & Exploration of metals & non-metal ores, Other Financial Services, services under Civil Aviation Services such as Maintenance & Repair Organizations, Petroleum sector, Ports & Shipping, Railway Infrastructure, Renewable Energy, Roads & Highways, Single Brand Retail Trading, Textiles & Garments, Thermal Power, Tourism & Hospitality and White Label ATM Operations.
UP TO 100% AUTOMATIC ROUTE
UP TO 100% FDI PERMITTED
UP TO 100% FDI PERMITTED UNDER AUTOMATIC & GOVERNMENT
Note:
(1) All the information pertaining to the sectors as stated above is in line with the extant Consolidated FOI Policy issued by DPIIT as amended from time to time.
(2) In sectors/ activities not listed above, FDI is permitted up to 100% on the automatic route, subject to applicable laws/regulations; security and other conditionality.
LIST OF PROHIBITED SECTORS:
* Foreign technology collaboration in any form including licensing for franchise, trademark, brand name, management contract is also prohibited for Lottery Business and Gambling and Betting activities.
** Real estate business shall not include the development of town shops, construction of residential/ commercial premises, roads, or bridges and Real Estate Investment Trusts (REITs) registered and regulated under the SEBI (REITs) Regulations, 2014.
PROCEDURES FOR INVESTMENT UNDER GOVERNMENT ROUTE
Step 1: Filing of Application Proposal for foreign-investment, along with supporting documents to be filed online, on the Foreign Investment Facilitation Portal, at the following URL: www.fifp.gov.in/
Step 2: Internal procedure for approvals
Pursuant to the above, additional information/ clarifications may be asked from the applicant which is to be provided within 1 week.
Proposals involving FDI exceeding INR 50 bn (approx. US$ 775 mn) shall be placed before the Cabinet Committee of Economic Affairs.
Step 3: Final Approval Once the proposal is complete in all respects, the same gets approved within 8-10 weeks.
REPATRIATION
Repatriation of dividend:
Repatriation of Interest:
Repatriation of capital:
Remittance of the asset (ie. sale proceeds of share and securities and their remittance) is governed by the Foreign Exchange Management (Remittance of Assets) Regulations, 2016 under FEMA
Reporting of transfer of capital instruments between residents and non-residents and vice versa is to be done in Form FCTRS, The Form e TRS should be submitted to the AD Category-| bank, within 60 days from the date of receipt of the amount of consideration.
AD Category-1 can allow remittance of sale proceeds (net of applicable taxes) of a security to the seller of shares outside India provided
security has been held on repatriation basis, Sale of security has been made in accordance with the prescribed guidelines and NOC/ Tax clearance certificate from the Income Tax department.
AD Category 1 banks are allowed to remit winding up proceeds of the companies which are under liquidation, subject to payment of taxes.
KEY STAKEHOLDERS
A public-private partnership (PPP) is a project delivery model whereby private entities undertake large-scale engineering and construction projects, often on works with defined objectives and criteria under the supervision of a government agency for mutual benefit.
BOOT (build, own, operate, transfer) is a project that transfers the risk and responsibility for the design, construction and operation of a large public infrastructure to private developers.
IFET Global Ventures Private Limited is Registered in Mumbai with Corporate Office in USA.