With an aim to give impetus to job creation and ease of doing business in the country, Government today approved 100 per cent FDI in Aviation, Defence and e-commerce sectors under the government approval route.
Present FDI regime permits 49 per cent FDI participation in the equity of a company under automatic route. Foreign investment beyond 49 per cent has now been permitted through government approval route, in cases resulting in access to modern technology in the country or for other reasons to be recorded.
Monday’s decision will allow 100 per cent FDI under government approval route for trading, including through e-commerce, in respect of food products manufactured or produced in India.
The decision was taken at a high-level meeting chaired by Prime Minister Narendra Modi in New Delhi today.
It has now been decided to permit 100% FDI under government approval route for trading, including through e-commerce (1/2)
— PMO India (@PMOIndia) June 20, 2016
This is the second major reform after the last radical changes announced in November last year. AIR correspondent reports, now most of the sectors would be under automatic approval route, except a small negative list.
File Photo: Prime Minister Narendra Modi with Finance Minister Arun Jaitley at an event to interact with tax administrators in New Delhi.
With these changes, India is now the most open economy in the world for FDI. In last two years, government has brought major FDI policy reforms in a number of sectors, including Defence, Construction Development, Insurance, Pension Sector and Broadcasting Sector.
In a twitter post, Prime Minister Modi said: India has been rated as number one FDI destination by many international agencies.
India has been rated as Number 1 FDI Investment Destination by several International Agencies. #TransformingIndia
— PMO India (@PMOIndia) June 20, 2016
Measures undertaken by the Government have resulted in increased FDI inflows at 55.46 billion dollars in the last financial year, as against 36.04 billion dollars during the financial year 2013-14. This is the highest ever FDI inflow for a particular financial year.
Economic Affairs Secretary Shaktikanta Das has said decision on FDI liberalization today is a follow up of decisions taken earlier.
Shaktikanta Das said wherever there are regulators in position there is no need for dual clearance by Foreign IInvestment Promotion Board. He said the whole approach is to make it automatic and process-driven.
