“Radical Changes” in FDI policy approved by Union Cabinet


Union Cabinet has given permission to the “radical” changes in the foreign direct investment policy. It has increased the FDI policy to 100% for various sectors. 

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The FDI regime was liberalized by the government on June 20. It was initiated with the objective of giving major force to employment generation in India.

For the second time, this step has been taken with some changes.

Some changes has been done in the FDI Policy which includes increase in sectoral caps, bringing more activities under automatic route and easing of conditionalities for foreign investment.

“The Union Cabinet chaired by Prime Minister Narendra Modi has given its ex post facto approval for the FDI policy amendments announced by the government on June 20, 2016.

“The FDI policy amendments are meant for liberalising and simplifying the FDI policy so as to provide ease of doing business in the country, leading to larger FDI inflows contributing to growth of investment, incomes and employment,” an official statement said.

According to the changed standards, remote interest in barrier segment is presently allowed up to 100 for every penny.

Prior arrangement allowed 49 for each penny FDI interest in the value of an organization under programmed course. FDI above 49 for each penny was allowed through endorsement on case to case premise, wherever it is prone to bring about access to current and 'condition of-craftsmanship' innovation in the nation.

With a perspective to help in modernisation of the current air terminals to build up an elevated expectation and simplicity weight on the current air terminals, 100 for every penny FDI under programmed course has been permitted in brownfield airplane terminal activities.

If there should be an occurrence of single brand retail exchanging, the legislature has loose neighborhood sourcing standards for up to three years, with earlier government endorsement, for substances undertaking exchanging of items having "state¬of¬art" and 'bleeding edge' innovation.

For private security offices, FDI up to 49 for every penny is presently allowed under programmed course and past that and up to 74 for each penny, government endorsement is required.

FDI roof in segments like transports, Direct to Home (DTH), Cable Networks, versatile TV and Headend-in-the Sky Broadcasting Service(HITS) has been expanded to 100 for every penny.

Standards for outside invesment in pharmaceutical segment too have been changed.

Additionally, 100 for every penny FDI under programmed course to trade, including through e-business has been allowed in appreciation of sustenance items made and/or created in India.

The administration said measures embraced by it has brought about expanded FDI inflows at $55.46 billion in 2015-16, as against $36.04 billion in 2013-14.

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