The decision on FDI reforms, taken at a high-level meeting chaired by Prime Minister Narendra Modi.
In defence, foreign investment beyond 49 per cent (and upto 100 per cent) has been permitted through the government approval route, in cases resulting in access to modern technology in the country
The decisions included permitting 100 per cent FDI under government approval route for trading, including through e-commerce, in respect of food products manufactured or produced in India, bringing into effect the proposal made in the Budget 2016-17
To promote the development of pharmaceutical sector, the government has permitted up to 74 per cent FDI under automatic route in existing pharmaceutical ventures. It added that the government approval route will continue beyond 74 per cent FDI and upto 100 per cent in such brown-field pharma.
The government has permitted 100 per cent FDI in India-based airlines. However, a foreign carrier can only own upto 49 per cent stake in the venture, and the rest can come from a private investors including those based overseas. This is expected to bring in more funds into domestic airlines. To boost airport development and modernisation, 100 per cent FDI in existing airport projects has been allowed without government permission, from 74 per cent permitted so far.
Quick reactions from the Major players in the market after FDI Reform:
We expect Rs 230 crore turnover this fiscal: Premier Explosives
Foreign original equipment manufacturers who had held back from striking deals because of a closed regime will now be forthcoming to ink joint ventures with India, said Vikram Mahajan, Director of the company
See orders worth Rs 5,000-7,000 cr in 2 quarters: L&T Defence
FII fund flows have always been petty in India, being nowhere close to a significant sum because of the controlled regime. We need defence modernisation and opening doors to FIIs will help us get more such technology, says JD Patil of L&T Defence, in an interview
Subsidies, tweaked aviation policy will attract investors: ICRA
The revamped FDI rules and National Civil Aviation Policy will help generate keen interest from foreign investors in the aviation sector, says Kinjal Shah, AVP of ICRA.
New FDI policy great news for aviation sector: Cyril Shroff
Cyril Shroff, Managing Partner at Cyril Amarchand Mangaldas said that the new policy is great news for the civil aviation sector and also sees mergers and acquisitions to pick up in the pharma industry.
What more FDI in pharma means for sector: Ajay Piramal
India only bright spot amid global mkts: World Bank India chiefWelcoming the relaxation in foreign direct investment (FDI) norms, World Bank’s Country Director in India Onno Ruhl said it is important for the government to open up the economy as it needs investment.
Relaxed FDI norms to boost manufacturing, generate jobs: Das
„With this (FDI) liberalization, we expect manufacturing activity to come in…more activity in defense products. The driving force behind the whole thing is that all this investment should facilitate creation of jobs,”