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Recent Changes In FDI Policy And Its Impacts.

  • The Department of Industrial Policy and Promotion issued a press note, amending the Foreign Direct Investment Policy, 2017 on 18 September, 2019.
  • The Government of India approved the proposal to amend the FDI policy in four sectors, namely, coal mining, digital media, single-brand retail trading and contract manufacturing.
  • As per the press release, the amendments were introduced to liberalize and simplify the FDI policy, and increase FDI in India, which in turn will boost the employment opportunities and economic growth.
  • Coal Mining- The amendment now allows 100% FDI in sale of coal carried out in accordance with the provisions of the Coal Mines Act, 2015 and Mines and Minerals Act, 1957. It removes the previous conditions to selling.
  • -Digital Media- The amendment adds a provision for 26% FDI in uploading or streaming of news or current affairs through digital media.
  • -Single Brand Retail Trading- The amendment allows 100% FDI for entities engaged in SBRT through automatic route. However, entities with over 51% FDI, are required to procure atleast 30% of the value of goods from India
  • -Contract Manufacturing- Even before the amendment, 100% FDI was allowed in this sector, however, the press note provides clarification on the kinds and nature of manufacturing activities.

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