New Foreign Investment Policy Document Launched by Indian Government
The Indian government, in a bid to consolidate the over-abundance of rules and regulations that govern foreign investment into the country, has launched a comprehensive new policy document to make all FDI policy information available in one place.
In a move that would provide foreign investors and sector regulators with a clearer understanding of foreign investment rules, it should also provide a predictability of policy direction as well as simplification.
Anand Sharma, Minister for Commerce and Industry, said that the consolidated policy had been initiated with the aim of integrating all prior regulations on FDI, contained in FEMA, RBI circulars and various press notes into one consolidated document.
Sharma said, “Having a single policy platform that would subsume the 178 press notes would also ease the regulatory burden for government; it will be updated every six months”.
“This consolidated press note will be superseded by a press note to be issued on September 30, 2010 to ensure that the framework document on FDI policy is kept updated,” he said.
FDI equity inflows for the month of February, 2010 have been $ 1.72 billion, which represents an increase of 15 per cent compared to the same month last year.
It is likely that the total inflows in the current financial year (2009-10) will be comparable to the total inflows received during the last financial year (2008-09).
This is despite the fact the United Nations Conference on Trade and Development (UNCTAD) had predicted a fall in global FDI investment flows by 30 per cent — from $ 1.7 trillion in 2008 to $ 1.2 trillion in 2009.
Chandrajit Banerjee, director general of Confederation of Indian Industry (CII) said, “The consolidation of FDI regulatory policy would aid simplification and boost global investors’ confidence”.