Read guidelines for Foreign Direct Investment (FDI) in India

Foreign Direct Investment in India

Foreign Direct Investment (FDI) plays a crucial role in the accelerated economic growth of the country. Over the years, FDI inflow in India is increasing. Government is encouraging Foreign Direct Investment (FDI) in all the vital sectors of the economy.

FDI in India is permitted as under the following forms of investments:
FDI is not permitted in the following industrial sectors:
Approval of Foreign Direct Investment in India
Foreign direct investments in India are approved through two routes:

(1) Automatic Approval by RBI
The Reserve Bank of India accords automatic approval within a period of two weeks (provided certain parameters are met) to all proposals involving:
FDI on automatic route is not allowed in the following cases:
(2) FIPB Route
FIPB stands for Foreign Investment Promotion Board which approves all other cases where the parameters of automatic approval are not met. Normal processing time is 4 to 6 weeks. FIPB has Secretary, Department of Economic Affairs as its chairman. The other members of the boards are Secretary, Department of Industrial Policy & Promotion, Commerce Secretary and Foreign Secretary

The government has set up Foreign Investment Implementation Authority (FIIA) to facilitate quick translation of FDI approvals into implementation by providing a pro-active one stop after care service to foreign investors, help them obtain necessary approvals and by sorting their operational problems.