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INDIA: SECTOR SPECIFIC POLICY FOR FOREIGN DIRECT INVESTMENT

Sector/Activity

FDI Cap/Equity

Entry Route

Other Conditions

Airports

(a) Greenfield projects

100%

Automatic

Subject to sectoral regulations notified by Ministry of Civil Aviation

(b) Existing projects

100%

FIPB beyond 74%

Subject to sectoral regulations notified by Ministry of Civil Avation

Construction Development projects including housing, commercial premises, resorts, educational institutions, recreational facilities, city and regional level infrastructure, townships

100%

Automatic

Subject to conditions notified vide Press Note 2 (2005 Series) including a minimum capitalization of US$ 10 million for wholly owned subsidiaries and US$ 5 millionfor joint venture. The funds would have to be brought within six months of commencement of business of the Company

Petroleum & Natural Gas

(a) Other than Refining and including market study and formulation; investment/financing; setting up infrastructure for marketing in Petroleum & Natural Gas sector)

100%

Automatic

Subject to sectoral regulations issued by Ministry of Petroleum and Natural Gas; and
in the case of actual trading and marketing of petroleum products, divestment of 26% equity in favour of India partner/public within 5 years.

(b) Refining

26% in case of PSUs

100% in case of Private companies


FIPB


Automatic

Subject to sectoral policy

Telecommunication

(a) Basic and cellular; Unified Access Services, National/International Long Distance, V-Sat, Public Mobile Radio Trunked Services (PMRTS), Global Mobile Personal Communications Services (GMPCS) and other value added telecom services

74% (including FDI, FII, NRI, FCCBs, ADRs, GDRs, convertible preference shares, and proportionate foreign equity in Indian promoters/investing Company

Automatic upto 49%


FIPB beyond 49%

Subject to guidelines notified in the PN 5/2005 Series

(b) ISP with gateways, radio-paging, end-to-end bandwidth

74%

Automatic up to 49%

FIPB beyond 49%

Subject to licencing and security requirements notified by the Department of Telecommunication
 

(c) ISP without gateway, infrastructure provider providing dark fibre, electronic mail and voice mail

100%

Automatic up to 49%

FIPB beyond 49%

Subject to the condition that such companies shall divest 26% of their equity in favour of Indian public in 5 years, if these companies are listed in other parts of the world. Also subject to licensing and security requirements, where required.

(d) Manufacture of telecom equipment

100%

Automatic

Subject to sectoral requirements

Power including generation ( Except Atomic energy); regulations transmission, distribution and Power Trading

 

 

Subject to provisions of the Electricity Act 2003

Ports

100%

Automatic

Subject to sectoral regulations

Roads & Highways

100%

Automatic

Subject to sectoral regulations

Shipping

100%

Automatic

Subject to sectoral regulations

 

 

 

 

 

 

 

 

 

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June 2008