The changes in the foreign direct investment regime for the pharmaceuticals sector approved by the union cabinet was notified in early December 2011. The department of industrial policy and promotion notified the changes through Press Note 3 of 2011.
Under the new regime, all FDI into Indian pharmaceuticals companies will have to be approved by the government. The greenfield foreign investment in the sector, however will continue to be on the approval route.
The overall FDI limit in this sector is to remain at 100%. The government had made these changes following fears that largescale takeover of Indian drug companies by multinationals will make medicine expensive.
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