FDI Policies in India

1. FOREIGN DIRECT INVESTMENT’S
IN

2. What is FDI
Non Resident entity or person Invest in Resident entity
Through Merger
Through Acquisition
Through Building
new facilities
Through Reinvesting
Profits earned from
Overseas Operations
Through Intra Company Loans

3. Need of FDI
Increase Sales & Profit
Entering into fast growing markets
Reduce Costs
Consolidate trade blocks Protect foreign markets
Acquiring Technology & Managerial Skills

4. Need of FDI
Inflow of foreign currency Increase in import and export
Improvement in infrastructure Improvement in Technology & Skills
Employment
Currency Placement

5. Procedure for receiving FDI in India
Automatic Route Government Route
As per the Indian govt. policy
for some business entities
government has kept
automatic route in which
entities wouldn’t be require to
take any prior govt.
permissions to invest in Indian
company.
In India for some businesses
would require the prior
permission of the govt. as well
as RBI and other govt. financial
institute to perform in Indian
Market’s. There are strict rules
and regulations has been kept
in policy to entertain this
sector organization.

6. • Lottery Business including Government/private lottery, online lotteries, etc.
• Gambling and Betting including casinos etc.
• Chit funds
• Nidhi company
• Trading in Transferable Development Rights (TDRs)
• Real Estate Business or Construction of Farm Houses
• Manufacturing of cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco
substitutes
• Activities/sectors not open to private sector investment e.g. Atomic Energy and
Railway Transport (other than Mass Rapid Transport Systems).
Prohibited Sectors for FDI through Indian Govt.

7. Sector specific Condition on FDI
Sr. No. Sector / Activity % of Equity Share as FDI Entry Route
1 Agriculture & Animal Husbandry 100% Automatic
2 Tea Plantation 100% Government
3
Mining and Exploration of metal and non-
metal ores including diamond, gold, silver
and precious ores but excluding titanium
bearing minerals and its ores
100% Automatic
4
Coal and Lignite ( Mining For power, steel &
cement projects in India) 100% Automatic
5 Coal Processing Plant 100% Automatic
6
Mining and mineral separation of titanium
bearing minerals and ores, its value addition
and integrated activities 100% Government
7 Petroleum & Natural Gas (Exploration Only)
100% Government
8
Petroleum refining by the Public Sector
Undertakings(PSU),without any disinvestment
or dilution of domestic equity in the existing
PSUs. 49% Automatic

8. Sector specific Condition on FDI
Sr. No. Sector / Activity % of Equity Share as FDI Entry Route
9
Manufacture of items reserved for production
in Micro and Small Enterprises 24% Government
10 Defence 26% Government
11 Defence Upto 49% Government
12
Broadcasting Carriage Services - Teleports, DTH,
Cable Networks, Mobile TV, HITS 74%
Automatic 49 % above that
Government upto 74%
13
Broadcasting Content Services ( FM & Uplinking
News and Current affairs TV Channels
26%
Government
14
Uplinking & Downlinking of Non News &
Current affairs TV Channels 100% Government
15 Print Media 26% Government
16
Publishing & Printing of Scientific and technical
Magazines 100% Government
17
Publication of facsimile edition of foreign news
Paper 100% Government

9. Sector specific Condition on FDI
Sr. No. Sector / Activity % of Equity Share as FDI Entry Route
18 Airports
19 (a) Greenfield projects 100% Automatic
20 (a) Existing projects 100% Automatic
21 Air Transport Services
22
(1)Scheduled Air Transport Service/Domestic
Scheduled Passenger Airline
49% FDI (100% for NRI's)
Automatic
23 (2) Non-Scheduled Air Transport Service 74% FDI (100% for NRI's) Automatic
24
(3)Helicopter services/seaplane services requiring
DGCA approval 100% Automatic
25 (4) Ground Handling Services 74% FDI (100% for NRI's) Automatic
26
(5)Maintenance and Repair organizations;flying
training institutes; and technical training
institutions. 100% Automatic
27
Courier services for carrying packages,parcels and
other items which do notcome within the ambit of
the Indian Post Office Act 100% Automatic
28
Construction Development: Townships, Housing,
Built-up infrastructure
100%
Automatic

10. Sector specific Condition on FDI
Sr. No. Sector / Activity % of Equity Share as FDI Entry Route
29 Industrial Parks – new and existing 100% Automatic
30
Satellites- establishment and operation,subject to the
sectoral guidelines of Department of Space/ISRO 74% Government
31 Private Security Agencies 49% Government
32
Telecom Services (including Telecom Providers
Category-I) 100%
Automatic up to 49%
Government route beyond 49%
33 E-commerce activities 100% Automatic
34 Single Brand product retail trading 100%
Automatic up to 49%
Government route beyond 49%
35 Multi Brand Retail Trading 51% Governemnt
36 Banking- Private Sector 74%
Automatic up to 49%
Government route beyond 49%
-74%
37
Banking- Public Sector subject to Banking Companies
(Acquisition & Transfer of Undertakings) Acts 20% Government
38 Power Exchanges 49% Automatic

11. Market Size of India due to FDI
According to Moody’s, is due to India’s current pro-growth policies. Net FDI inflows
totalled US$ 14.1 billion in the first five months of 2014-15, representing a 33.5 per
cent increase from the same period in 2013-14.

12. Latest Announcements through Government
• Ministry of Railway has announced that foreign investors can invest Rs. 90,300
Crore in rail infrastructure through FDI
• Government has also announced heavy investments on power, roads &
infrastructure where foreign investors can participate through FDI

13. • There is been lot of investment is expected to get invested in India through foreign
investors in coming future.
• Where as per the many of reports this time government will be working on the
almost US $ 1 Trillion as funds for the infrastructure, power.
• Where Shri. Narendra Modi has also supported “ Digital India” as activity which
could support telecommunication and Internet industry which will result in heavy
FDI investments in India.
Way Ahead

14. Arnab Ray
Gaurav Sapre
Kunal Lalwani