The fast and steadily growing economy of India in majority of its sectors, has made India one of the

most famous and popular destinations in the whole world, for Foreign Direct Investment. India's everexpanding markets, liberalization of trade policies, development in technology and
telecommunication, and loosening of diverse foreign investment restrictions, have further collectively
made India, the apple of investors' eye, for most productive, profitable, and secure foreign investment.
According to a recent survey by the United Nations Conference on Trade and Development
(UNCTAD), India has conspicuously emerged out as the second most popular and preferable
destination in the entire world, after China, for highly profitable foreign direct investment.
Indias burgeoning economy attained another major milestone, as the South Asian nation surpassed
both China and the U.S. to become the top global destination for foreign direct investment (FDI) in
Greenfield projects. India is considered as the fastest growing economy among major Nations. Report
released by the World Economic Forum also saw India surge up the global ranking for
competitiveness, going from 71st last year to 55th out of 144 countries. The report says Indias bump
in the rankings, calculated using a number of economic factors, and is largely due to the governments
pro-business, pro-growth and anti-corruption stance.
To further boost this entire investment environment and to bring in foreign investments in the country,
the Government has brought in FDI related Reforms and liberalisation touching upon 15 major
Sectors of the Economy. The salient measures are:

1. Limited Liability Partnerships, downstream investment and approval conditions.

Investments in LLPs will not require Government approval. 100% FDI is now permitted
under the automatic route in LLPs operating in sectors/activities where 100% FDI is allowed,
through the automatic route and there are no FDI-linked performance conditions.
2. Investment by companies owned and controlled by Non-Resident Indians (NRIs)
Such entities owned and controlled by NRIs will be treated at par with NRIs for investment in
India.
3. Establishment and transfer of ownership and control of Indian companies
Consequent to foreign investment, transfer of ownership and/or control of the investee
company from residents to non-residents is also permitted. However, there would be a lockin-period of three years, calculated with reference to each tranche of FDI, and transfer of
immovable property or part thereof is not permitted during this period.
4. Agriculture and Animal Husbandry
Certain conditions of FDI policy on Agriculture and Animal Husbandry activities have been
simplified.
5. Plantation
The government has decided to open certain other plantation activities namely; coffee, rubber,
cardamom, palm oil tree and olive oil tree plantations also for 100% foreign investment.
Foreign investment in the plantation sector would henceforth be under automatic route.
6. Mining and mineral separation of titanium bearing minerals and ores, its value addition
and integrated activities
Certain conditions of FDI policy on Mining and mineral separation of titanium bearing
minerals and ores, its value addition and integrated activities have been simplified.

7. Defence
In the Defence Sector, foreign investment up to 49% is permitted under Government approval
route. Foreign investment above 49% is also permitted, subject to approval of Cabinet
Committee on Security (CCS) on case to case basis
8. Broadcasting Sector
In cable networks, direct to home, Mobile TV new Cap is 100%;
In FM radio and Up-linking of News & Current affairs TV channel new Cap is 49%;
In Up-linking of Non-News & Current affairs TV channel & Down-linking of TV channel
new Cap is 100%.
9. Civil Aviation
Foreign investment up to 49% is allowed in Scheduled Air Transport Service/ Domestic
Scheduled Passenger Airline (SOP). It has now been decided that Regional Air Transport
Service (RSOP) will also be eligible for foreign investment up to 49% under automatic route.
10. Increase of sectoral cap
Non-Scheduled Air Transport Service, Ground Handling Services, Satellites- establishment
and operation and Credit Information Companies have now been increased from 74% to
100%.
11. Construction development sector
100% FDI under automatic route is permitted in completed projects for operation and
management of townships, malls/ shopping complexes and business centres.
12. Cash and Carry Wholesale Trading / Wholesale Trading (including sourcing from
MSEs)
Single entity will be permitted to undertake both the activities of single brand retail trading
(SBRT) and wholesale with the condition that conditions of FDI policy on wholesale/ cash &
carry and SBRT have to be complied by both the business arms separately.
13. Single Brand Retail Trading and Duty free shops
100% FDI is now permitted under automatic route in Duty Free Shops located and operated in
the Customs bonded areas.
14. Banking-Private Sector; and
Government has decided to introduce full fungibility of foreign investment in BankingPrivate sector. Accordingly, FIIs/FPIs/QFIs, following due procedure, can now invest up to
sectoral limit of 74%, provided that there is no change of control and management of the
investee company.
15. Manufacturing Sector
Manufacturer will be permitted to sell their products through wholesale and/or retail,
including through e-commerce without Government approval.

Seria
l No.
1.

Sector
Insurance & Sub-activities

2.

Defence Sector

3.

Broadcasting Sector
Teleports
Direct to home
Cable Networks
Mobile TV
Headed-in-the-sky

Post-Reform (Cap)

26%

49%
Excess of 49%
Government route

49%

100%
(Up to 49%
Automatic route
Above 49%
Government route)

FM radio
Up-linking of News &
Current affairs TV channels

26%

49% Government
route

Up-linking of Non- News &

Current affairs TV channels
Downlinking of TV channels

49%

100% Automatic
route

Foreign Portfolio & Venture Capital

Investment

24%

49%

Non-scheduled air transport, ground

handling, Satellite & Credit information
companies
Construction Development Sector

74%

100% Automatic
route

5.

6.
7.

Plantation
Coffee, rubber, cardamom, palm oil tree
& olive oil tree

8.

Single Brand Retail Trading

Duty Free Shops

9.

49%

4.

Pre-Reform
(Cap)
26%

Limited Liability Partnership

10. Regional Air Transport

100% Automatic
route
100% Automatic
route

100% Automatic
route
100% Automatic
route
49% Automatic
route