Foreign Direct Investment Part 2



Up to 100% FDI is permitted on automatic route in petroleum products marketing. The sector would be permissible subjected to the existing sectored policy and regulatory framework in the oil marketing sector. Again up to 100% FDI is allowed in on the automatic route in oil exploration in both small and medium sized fields subject to and under the policy of the Government on private participation in exploration of oil and the discovered fields of national oil companies. usf95zone

The automatic route for petroleum products pipeline subjected to and under the Government policy and regulations there Permits 100% FDI. Prior Government approval is required to permit FDI up to 100% for Natural Gas/LNG Pipelines.

Likewise, 100% wholly owned Subsidiary (WoS) is permitted for the purpose of market study, formulation and investment/Financing.

A minimum of 26% Indian equity is required over 5 years for actual trading and marketing.
In case of public sector units (PSUs), 26% of FDI is permitted and will hold 26% (Refining) and balance 48% by public, although automatic route is not available in this sector. Private Indian companies, is allowed up to 100% FDI under the automatic route techmagazinenews

Postal services

FDI up to 100% is permitted in courier services with prior Government approval excluding distribution of letters, which is reserved exclusively for the state

Print media

The following FDI participation in Indian entities publishing News Papers and periodicals is permitted:

The publishing/printing scientific & technical magazines, periodicals & journals allow 100% FDI. Again, FDI up to 26% is allowed for publishing News Papers and Periodicals dealing in News and Current Affairs subjected to verification of antecedents of foreign investor, keeping editorial and management control in the hands of resident Indians and ensuring against dispersal of Indian equity. The detailed guidelines have been issued by Ministry of Information and Broadcasting renownednews


The basic cellular value added services and global mobile personal communications by satellite, allows limited FDI up to 74%, which is subjected to licensing and security requirements along with adherence by the companies (who are investing and the companies in which the investment is being made) to the license conditions for foreign equity cap and lock – in period for transfer and addition of equity and other license provisions. In ISPs with gateways, radio-paging and end-to-end bandwidth, FDI is permitted up to 74%, and anything beyond 49% requires Government approval.

These services would be subjected to licensing and security requirements. No equity cap is applicable to manufacturing activities. FDI up to 100% is allowed for the following activities in the telecom sector and these includes ISPs not providing gateways (both for satellite and submarine cables) Infrastructure Providers providing dark fiber (IP Category I), Electronic Mail; and Voice Mail xnxx

The above services would be subject to the following conditions:

FDI up to 100% is allowed subjected to the condition that such company would divest 26% of their equity in favor of Indian public in 5 years, if these companies are listed in other parts of the world. The above services would be subject to licensing and security requirements, wherever required and proposals for FDI beyond 49% shall be considered by FIPB on case to case basis.


Trading is permitted under automatic route with up to 51% FDI provided to primarily export activities and the undertaking is an export house/trading house/super trading house/star trading house. However, under the FIPB route:-

100% FDI is permitted in case of trading companies for the following activities:

Exports, bulk imports with ex-port/ex-bonded warehouse sale, cash and carry wholesale trading other import of goods or services provided allows at least 75% is for procurement and sale of goods and services among the companies of the same group and for third party use or onward transfer/distribution/sales techimpacter

The following kinds of trading are also permitted, subject to provisions of Foreign Trade Policy:

Companies for providing after sales services (that is not trading per sector), domestic trading of products of JVs is permitted at the wholesale level for such trading companies who wish to market manufactured products on behalf of their joint ventures in which they have equity participation in India. Trading of hi-tech items/items requiring specialized after sales service, for social sector, trading of hi-tech, medical and diagnostic items, trading of items sourced from the small scale sector, based on technology provided and laid down quality specifications, a company can market that item under its brand name

Domestic sourcing of products for exports and Test marketing of such items for which a company has approval for manufacture provided such test marketing facility will be for a period of two years, and investment in setting up manufacturing facilities commences simultaneously with test marketing

FDI up to 100% permitted for e-commerce activities subject to the condition that such companies would divest 26% of their equity in favor of the Indian public in five years, if these companies are listed in other parts of the world. Such companies would engage only in business to business (B2B) e-commerce and not in retail trading

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