MUMBAI: The growth in Foreign Direct Investment (FDI) has been significant after the launch of 'Make in India' initiative in September 2014. The country has seen 48 per cent increase in FDI equity inflows during October 2014 to April 2015 over the corresponding period last year.
In 2014-15, the country witnessed unprecedented growth of 717 per cent to $40.92 billion of investment by Foreign Institutional Investors (FIIs). The FDI inflow under the approval route saw a growth of 87 per cent during 2014-15 with inflow of $2.22 billion despite more sectors having been liberalized during this period and with more than 90 per cent of FDI being on automatic route. These indicators showcase remarkable pace of approval being accorded by the government and confidence of investors in the resurgent India.
The increased inflow of FDI in India, especially in a climate of contracting worldwide investments, indicates the faith that overseas investors have imposed in the country's economy and the reforms initiated by the Government towards ease of doing business. The Make in India initiatives of the Government and its outreach to all investors have made a positive investment climate for India which is evidenced in the results for the last financial year especially the second half.
The FDI inflow during the financial year 2014-15 was spread across the sectors evidencing the fact of positive eco-system of investment opportunities, which India is now providing- Services Sector, Telecommunication, Trading, Automobile Industry, Computer Software & Hardware, Drugs & Pharmaceuticals and Construction activities.
The FDI policy was amended to further enable a positive investment climate and sync it with the vision and focus areas of the present Government such as affordable housing, smart cities, financial inclusion and reforms in railway infrastructure. The Construction Development sector was allowed easy exit norms with rationalized area restrictions and due emphasis on affordable housing. The FDI cap in insurance and pension sector has been raised to 49 per cent.
100 per cent FDI has been allowed in railway infrastructure, excluding operations and also in the medical devices sector.
Further the definition of NRI was expanded to include Overseas Citizen of India (OCI) cardholders as well as Persons of Indian Origin (PIO) cardholders. NRIs investment under Schedule 4 of Foreign Exchange Management Act, 1999 (FEMA), Regulations will be deemed to be domestic investment made by residents, thereby giving flexibility to NRIs to invest in India.
