The Government has put in place an investor-friendly policy, wherein most sectors, except certain strategically important sectors, are open for 100 per cent FDI under the automatic route, the Minister of State in the Ministry of Commerce and Industry, Som Parkash said in reply to a parliamentary question today.
Further, the policy on FDI is reviewed on an ongoing basis, to ensure that India remains an attractive and investor-friendly destination. To simplify the approval process of foreign Investment and to promote ease of doing business, the erstwhile Foreign Investment Promotion Board (FIPB) has been abolished in May 2017 and a new regime has been put in place. Under the new regime, the process for granting FDI approvals has been simpliﬁed wherein the work relating to the processing of applications for FDI has been delegated to the concerned Ministries/ Departments and DPIIT is the nodal department for facilitating the process.
Detailed standard operating procedure for the approval process has been issued by DPIIT. Further, all proposals seeking Government approval under the FDI route are now ﬁled on National Single Window System (NSWS) Portal.
FDI policy provisions have been progressively liberalized and simpliﬁed across various sectors in the last eight years, such as Pension, Other Financial Services, Asset reconstruction Companies, Broadcasting, Pharmaceuticals, Single Brand Retail Trading, Construction & Development, Power Exchanges, e-commerce activities, Coal Mining, Contract Manufacturing, Civil Aviation etc. In the recent past, reforms in the FDI Policy have been undertaken in sectors such as Defence, Insurance, Petroleum & Natural Gas and Telecom.
FDI in the defence sector is now allowed up to 74 per cent (from earlier 49per cent) through automatic routes for companies seeking a new industrial license. In the insurance sector, the FDI limit has been raised from 49 per cent to 74 per cent for insurance companies under the automatic route and foreign ownership and control have been allowed with safeguards.
FDI up to 20 per cent in Life Insurance Corporation of India (LIC) has been permitted under automatic route. Further, FDI up to 100 per cent under the automatic route has been permitted in the Telecom sector.