Home » Defence » Government Increases FDI Limits in various sectors, including Telecom, Insurance and Defence

Government Increases FDI Limits in various sectors, including Telecom, Insurance and Defence

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Looking to increase investment opportunities for foreign firms, the Government of India has decided to make sweeping changes to the existing FDI policy. The present approvals are in-principle in nature and further details, including additional terms and conditions will be available only when formal press notes are released.

The key proposed changes are:

Sr. No.

Sector

Existing Limits

Modified Limits

 

1. Defence Upto 26% with Government Approval General cap specified at 26%. However, investment upto 49% permitted in “state of the art technology” with approval of the Cabinet Committee on Security.
2. Insurance 26% under automatic route Upto 49% under automatic route
3. Telecom Upto 49% through automatic route and upto 74% with Government Approval Increased to 100% (upto 49% under the automatic route and remaining under the Government Approval Route)
4. Asset Reconstruction Companies 74% under Government Approval Route Increased to 100% (upto 49% under the automatic route and remaining under the Government Approval Route)
5. Credit Information Companies 49% Increased to 74%
6. Petroleum Refining 49% under approval route 49% under automatic route
7. Power Exchanges 49 % under Government route (mix of FDI and FII) 49% under automatic route (FDI and FII limits not specified)
8. Courier Services 100% permitted under automatic route
 9.  Single Brand Retail  100% under Government route  100% (upto 49% under the automatic route and remaining under the Government Approval Route)
10. Tea Plantations 100% under Government Approval Route 100% (upto 49% under the automatic route and remaining under the Government Approval Route)

The above will be elaborated and the terms and conditions made clear when the formal press releases are made. We would update this post at that point.

 

Anuj Sahay [anuj.sahay@pxvlaw.com]

Deepto Roy [deepto.roy@pxvlaw.com]

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