100% FDI in defence, civil aviation |
The Government of India on June 20, 2016, relaxed Foreign Direct Investment (FDI) norms in a host of sectors including civil aviation, single-brand retail, defence and pharma by permitting more investments under automatic route.Other sectors in which FDI norms have been relaxed include e-commerce in food products, broadcasting carriage services, private security agencies and animal husbandry. Now most of the sectors would be under automatic approval route, except a small negative list. One wonders if India is now the most open economy in the world for FDI.The decision to further liberalise FDI regime with the objective of "providing major impetus to employment and job creation in India" was taken at a meeting chaired by Prime Minister Narendra Modi. This is the second major reform in the FDI space. The Centre in last November had significantly relaxed the foreign investment regime.Key changes include allowing 100% FDI under government approval route for trading, including through e-commerce, in respect of food products manufactured or produced in India and permitting up to 100 per cent FDI in defence sector.
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