The latest changes in foreign direct investment (FDI) norms in India have made entry and control of foreign investors in a lot of sectors easier. Defence and civil aviation have been opened to 100% FDI under the government approval route (the FDI limit was 49% in airlines before). Many other sectors have been allowed 100% (or near 100%) FDI with government approval or through the automatic approval route. These include animal husbandry, trading of food products produced in India (including through e-commerce), private security services and broadcasting carriage services (such as DTH, cable networks and mobile TV). Up to 74% FDI (against the previous 49%) in brownfield pharmaceutical industry projects will no longer require government approval. Brownfield airports too have been brought under the automatic approval route.
The condition of access to state-of-the-art technology in India has been removed in defence. In addition, for single-brand retail trading companies undertaking business with state-of-the-art technology, the restriction of sourcing up to a certain percentage of inputs locally has been totally relaxed for three years, followed by a partial relaxation for another five years – a favour granted apparently on Apple’s appeal.
The stated objective of 100% FDI and other relaxations is to promote employment and improve infrastructure, along with greater FDI inflows and the ease of doing business in India. An official statement said that with most sectors coming under the automatic approval route, India is now the most open economy in the world for FDI.
21/06/16 Rahul Pandey/The Wire
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The condition of access to state-of-the-art technology in India has been removed in defence. In addition, for single-brand retail trading companies undertaking business with state-of-the-art technology, the restriction of sourcing up to a certain percentage of inputs locally has been totally relaxed for three years, followed by a partial relaxation for another five years – a favour granted apparently on Apple’s appeal.
The stated objective of 100% FDI and other relaxations is to promote employment and improve infrastructure, along with greater FDI inflows and the ease of doing business in India. An official statement said that with most sectors coming under the automatic approval route, India is now the most open economy in the world for FDI.
21/06/16 Rahul Pandey/The Wire
