The Union Cabinet on 21 May 2015 gave its nod for changes in the Foreign Direct Investment (FDI) policy on investments by Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs) and Overseas Citizens of India (OCIs).
The amendments to the FDI policy are
• The definition of Non-Resident Indian (NRI) was expanded by including OCI cardholders as well as PIO cardholders. The decision is meant to align the FDI policy with the stated policy of the Government to provide PIOs and OCIs parity with Non Resident Indians (NRIs) in respect of economic, financial and educational fields.
• Investment made by NRIs under Schedule 4 of FEMA (Transfer or Issue of Security by Persons Resident outside India) Regulations, 2000 will be deemed to be domestic investment at par with the investment made by residents. The decision is meant to provide clarity in the FDI policy as such investment is not included in the category of foreign investment.
The above decisions of the cabinet coupled with its earlier decisions allowing FDI up to 100 percent in the Railway infrastructure sector and up to 49 per cent in the insurance and defence sectors are expected to result in increased investments and remittances leading to economic growth of the country.
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When: 21 May 2015