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  • FOR INSURANCE THERE IS A PROPOSAL TO INCREASE THIS FOR 49 %FDI in telecommunication up to 100% is allowed subject to the condition that such companies would divest 26% of their equity in favor of Indian public in 5 years, if these companies are listed in other parts of the world.

Fdi Fdi Presentation Transcript

  • Think Beyond “FOREIGN DIRECT INVESTMENT” www.StudsPlanet.com
  • 1. A component of a country's national financial accounts. 2. Investment of foreign assets into domestic structures, equipment, and organizations. 3.It does not include foreign investment into the stock markets. www.StudsPlanet.com
  • • Foreign investment that establishes a lasting interest in or effective management control over an enterprise. • Foreign direct investment can include buying shares of an enterprise in another country, reinvesting earnings of a foreign- owned enterprise in the country where it is located, and parent firms extending loans to their foreign affiliates.www.StudsPlanet.com
  • • International Monetary Fund (IMF) guidelines consider an investment to be a foreign direct investment if it accounts for at least 10 percent of the foreign firm's voting stock of shares. • However, many countries set a higher threshold because 10 percent is often not enough to establish effective management control of a company or demonstrate an investor's lasting interest. www.StudsPlanet.com
  • • Foreign investment in India is regulated by Government of India’s FDI policy. The FDI guidelines administered by the “Ministry of Commerce and Industry”. • GOI has set up the Foreign Investment Implementation Authority (FIIA) to facilitate quick translation of Foreign Direct Investment (FDI) approvals into implementation, to provide a one- window to foreign investors by helping them obtain necessary approvals, sort out operational problems and meet with various Government agencies www.StudsPlanet.com
  • 6 1. Maharashtra Maharashtra received the lion's share of the FDI $2.43 billion (Rs 11,154 crore), which is 35% of the total FDI inflows in to the country. 2. National Capital Region NCR received $1.85 billion (Rs 8,476 crore) in FDI during the period. The region accounted for 20% of the total FDI. 3. West Bengal, Sikkim, Andaman & Nicobar Islands These states attracted the third highest FDI inflows worth $1.416 billion (Rs 6,050 crore) 4. Karnataka - $936 million (Rs 4,333 crore) 5. Punjab, Haryana, Himachal Pradesh - $904 million (Rs 4,141 crore) Data: Jan – Jun 2010www.StudsPlanet.com
  • (In Rs. Crore) (In US$ mn) 1. April 2011 13,847 3,121 2. May 2011 20,946 4,664 3. June 2011 25,371 5,656 4. July 2011 4,886 1,099 5. August 2011 12,814 2,830 6. September 2011 8,407 1,766 7. October 2011 5,715 1,161 8. November 2011 12,909 2,538 9. December 2011 7,124 1,353 10 January 2012 10,288 2,004 11. February 2012 10,874 2,211 2011-12 (up to February 2012) # 133,181 28,403 2010-11 (up to February 2011) 83,687 18,354 %age growth over last year ( + ) 59 % ( + ) 55 % www.StudsPlanet.com
  • Rank s Country 2009-10 (April- March) 2010-11 ( April- March) 2011-12 (April- Feb.) Cumulative Inflows (April ‟00 - Feb.12) %age to total Inflows (in terms of US $) 1. MAURITIU S 49,633 (10,376) 31,855 (6,987) 44,116 (9,426) 286,876 (63,653) 39 % 2. SINGAPO RE 11,295 (2,379) 7,730 (1,705) 23,770 (5,070) 76,646 (16,965) 10 % 3. JAPAN 5,670 (1,183) 7,063 (1,562) 13,570 (2,869) 57,332 (12,210) 8 % 4. U.S.A. 9,230 (1,943) 5,353 (1,170) 4,648 (976) 47,190 (10,425) 6 % 5. U.K. 3,094 (657) 3,434 (755) 12,525 (2,758) 41,958 (9,397) 6 % www.StudsPlanet.com
  • 49 49 51 26 49 100 100 100 100 100 100 100 0 20 40 60 80 100 120 www.StudsPlanet.com
  • 0% 10% 20% 20% 8% 7% 7% 7% 6% 4% 4% 4% 2% INFLOW www.StudsPlanet.com
  • FII www.StudsPlanet.com
  • FII denotes all those investors or investment companies that are not located within the territory of the country in which they are investing. FIIs were first allowed to transact in Indian markets in 1993. The collective FII holding in a listed company cannot exceed 40 per cent of its equity capital. www.StudsPlanet.com
  • • Mutual funds, insurance companies, pension funds, investment trusts, endowment funds and charitable trusts incorporated outside India but investing in equity and debt securities in the country are known as FIIs. • They collect money from individuals and corporates (primarily from countries belonging to the European and American continents), and invest it in financial instruments worldwide, with India being one of the targeted markets.www.StudsPlanet.com
  • • FIIs wanting to invest in equity and debt securities in India have to register with SEBI. Under SEBI (Foreign Institutional Investors) Regulations, 1995, they also have to get approval from the RBI to operate foreign currency accounts (to bring in and take out funds) and rupee bank accounts (to pay for transactions). www.StudsPlanet.com
  • • Enhanced flows of equity capital • FII inflows help in financial innovation and development of hedging instruments. • Improving capital markets. • FIIs as professional bodies of asset managers and financial analysts enhance competition and efficiency of financial markets. • Equity market development aids economic development. • Improved corporate governance. • FIIs constitute professional bodies, improve corporate governance. www.StudsPlanet.com
  • • Problems of Inflation • Problems for small investor • Adverse impact on Exports • Hot Money www.StudsPlanet.com
  • Month(2012) Equity Debt Total January 10,357.70 15,971.20 26,328.90 February 25,212.10 10,015.80 35,227.90 March 8,381.10 -6,588.60 1,792.50 April -1,109.10 -3,787.50 -4,896.60 May NA June NA July NA August NA September NA October NA November NA December NA Total 42,841.80 15,610.90 58,452.70 * The data presented above is compiled on the basis of reports submitted to SEBI by custodians and constitutes trades conducted by FIIs on and up to the previous trading day(s).www.StudsPlanet.com
  • Thank you www.StudsPlanet.com