India ’ s investment policies are designed to attract significant capital inflows into India on a sustained basis and to encourage technology collaborations between Indian and foreign entities . Policy initiatives taken over the last few years have resulted in inflows of foreign investments in diverse sectors of the economy .
Sectoral Composition of FDI ( April 2000 - January 2012 ) ( US $ Million )
30000
3636
|
25000 |
|
|
|
|
|
20000 |
|
|
|
|
U S $ Millio n |
15000 10000 5000 |
70 336 |
3139 1018 |
581 456 760 |
1263 165 |
|
0 |
|
|
|
|
Services Sector Hotel & Tourism Power Chemicals
Telecommunications Construction Automobile
Computer Harware & Software Drugs & Pharmaceuticals Metallurgical Industries
Figure 8 Source : Department of Industrial Policy & Promotion , Ministry of Commerce & Industry ( April 2000 till November 2010 )
2.2.1 Joint Ventures & Wholly Owned Subsidiaries
The FDI and all foreign exchange matters are regulated through the Foreign Exchange Management Act , 1998 FEMA . The National Industrial Classification 1987 is the basis for determining activities and classification for the purpose of FDI .
2.2.1.1 Automatic Route
Currently , FDI in all sectors or activities , except those specifically restricted , falls under the automatic route .
Automatic route does not require any prior approval either from the government or the RBI . The company is required to simply inform the concerned regional office of the RBI on receiving remittance towards share application and post issuing shares to the foreign investor 1 .
Investment in public sector units , as also for Export Oriented Units ( EOU ), Export Processing Zones ( EPZ ) and Software Technology Parks ( STP ) would be under the automatic route .
1
Refer section 3.1.5.4
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