What is Indias policy on Foreign Direct Investment (FDI)?
FDI is subject to an approval from the Government of India in the following cases • Activities/items that require an Industrial License; • Proposals in which the foreign collaborator has an existing financial / technical collaboration in India in the same field. (Press Note No. 1 of 2005 series issued by the Government of India); • Proposals for acquisition of shares in an existing Indian company in a financial services sector and where Securities and Exchange Board of India (SEBI) (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 is attracted; • All proposals exceeding the sectoral caps or in sectors where FDI is not permitted. There are ceilings on investment in certain sectors/activities. These limits are called sectoral caps and FDI is not permitted beyond specified caps, unless an approval is obtained. For instance, activity of publishing newspapers and periodicals (print media sector) is restricted by a sectoral cap of 26 per cent. Effectively, a foreign investo
