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  • Foreign Exchange Management - Assignment 3

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    Chandler Bing
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    This document discusses foreign direct investment (FDI) routes and sectors in India. It outlines that there are two main routes for FDI - the automatic route which does not require government approval, and the government route which does require prior approval. It then lists several sectors that fall under 100% automatic route, up to 100% automatic route, and up to 100% government route categories. Finally, it lists sectors where FDI is prohibited.

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    FOREX Assignment. 3

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    This document discusses foreign direct investment (FDI) routes and sectors in India. It outlines that there are two main routes for FDI - the automatic route which does not require government approval, and the government route which does require prior approval. It then lists several sectors that fall under 100% automatic route, up to 100% automatic route, and up to 100% government route categories. Finally, it lists sectors where FDI is prohibited.

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    11 views3 pages

    Foreign Exchange Management - Assignment 3

    Uploaded by

    Chandler Bing
    This document discusses foreign direct investment (FDI) routes and sectors in India. It outlines that there are two main routes for FDI - the automatic route which does not require government approval, and the government route which does require prior approval. It then lists several sectors that fall under 100% automatic route, up to 100% automatic route, and up to 100% government route categories. Finally, it lists sectors where FDI is prohibited.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    of 3

    TYBBA-IB

    15602

    NIDHI PALRECHA

    Foreign Exchange Management – Assignment 3

    FDI entry route in India:

    • Automatic Route
    Under the Automatic Route, the non-resident investor or the Indian company does not require any
    approval from Government of India for the investment.

    • Government Route
    Under the Government Route, prior to investment, approval from the Government of India is
    required. Proposals for foreign direct investment under Government route, are considered by
    respective Administrative Ministry/ Department.

    Sector specific conditions for FDI:


    Sectors which come under the ' 100% Automatic Route' category are

    Agriculture & Animal Husbandry, Air-Transport Services (non-scheduled and other services under
    civil aviation sector), Airports (Greenfield + Brownfield), Asset Reconstruction Companies, Auto-
    components, Automobiles,
    Biotechnology (Greenfield), Broadcast Content Services (Up-linking & downlinking of TV channels,
    Broadcasting Carriage Services, Capital Goods, Cash & Carry Wholesale Trading (including sourcing
    from MSEs), Chemicals, Coal & Lignite, Construction Development, Construction of Hospitals, Credit
    Information Companies, Duty Free Shops, E-commerce Activities, Electronic Systems, Food
    Processing, Gems & Jewellery, Healthcare, Industrial Parks, IT & BPM, Leather, Manufacturing,
    Mining &

    Exploration of metals & non-metal ores, Other Financial Services, Services under Civil Aviation
    Services such as Maintenance & Repair Organizations, Petroleum & Natural gas, Pharmaceuticals,
    Plantation sector, Ports & Shipping, Railway Infrastructure, Renewable Energy, Roads & Highways,
    Single Brand Retail Trading, Textiles & Garments, Thermal Power, Tourism & Hospitality and White
    Label ATM Operations.

    Sectors which come under up to 100% Automatic Route' category are

    Infrastructure Company in the Securities Market: 49%

    Insurance: up to 49%

    Medical Devices: up to 100%


    Pension: 49%

    Petroleum Refining (By PSUs): 49%

    Power Exchanges: 49%

    Government route

    Sectors which come under the 'up to 100% Government Route' category are

    Banking & Public sector: 20%

    Broadcasting Content Services: 49% Core Investment


    Company: 100%
    Food Products Retail Trading: 100%

    Mining & Minerals separations of titanium bearing minerals and ores: 100%

    Multi-Brand Retail Trading: 51%

    Print Media (publications/ printing of scientific and technical magazines/ specialty journals/
    periodicals and facsimile edition of foreign newspapers): 100%

    Print Media (publishing of newspaper, periodicals and Indian editions of foreign magazines dealing
    with news & current affairs): 26%

    Satellite (Establishment and operations): 100%

    FDI prohibited sectors are:

    • Gambling and Betting


    • Lottery business (including government/ private lottery, online lotteries etc)
    • Activities /sectors not open to private sector investment (eg, atomic energy /railways)
    • Retails trading (expect single-brand product retailing)
    • Business of chit fund
    • Real estate business or construction of farm houses
    • Trading in transferable development rights (TDRs)
    • Manufacturing of tobacco, cigars, cheroots, cigarallos, cigarettes and other tobacco substitutes

    • Agriculture(excluding floriculture, horticulture, apiculture and cultivation of vegetables and


    mushrooms under controlled conditions, the development and production of seeds & planting
    materials, animals husbandry including the breeding of dogs, viniculture & aquaculture under
    controlled conditions and services related to the agro and allied sector)

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