Foreign Investment – Neeraj Bhagat & Co.

January 1, 2021 / Foreign Investment

Investments by some FPIs may attract Retro Tax

The budget proposal to apply indirect transfer provisions to even Category II foreign portfolio investors (FPIs) could lead to the imposition of retrospective tax on certain transactions, experts said. The government had restricted the exemption from indirect transfer taxes to Category I FPIs in the budget. Previously, even Category II FPIs had enjoyed the exemptions. While making changes to the law, the government grandfathered or exempted only those transactions made by such FPIs till September 23, 2019, from the ambit …

January 6, 2020 / Foreign Investment

FDI rises 15 per cent during Apr-Sep to $26 billion

Foreign direct investment into India grew 15 per cent to USD 26 billion during the first half of the current financial year, according to government data. Inflow of foreign direct investment (FDI) during April-September of 2018-19 stood at USD 22.66 billion.
Sectors, which attracted maximum foreign inflows during April-September 2019-20, include services (USD 4.45 billion), computer software and hardware (USD 4 billion), telecommunications (USD 4.28 billion), automobile (USD 2.13 billion) and trading (USD 2.14 billion), the commerce and industry ministry …

April 8, 2020 / Foreign Investment

FDI in Defence Sector in India

Defence Industry in India is subject to Industrial License under the Industries (Development & Regulation) Act, 1951 and manufacture of small arms and ammunition under the Arms Act, 1959. The detailed guidelines in this regard may be seen under the Press Note available at www.dipp.nic.in followed by link Acts & Rules.

Previously, India had relaxed foreign direct investment norms in defence sector, doing away with the clause that allowed only “state of the art” technology to be considered for stakes …

August 20, 2019 / Foreign Investment

Govt looks at fixing FDI security gaps

Concerned over rising foreign direct investment (FDI) inflows into strategic sectors like telecom as well as information technology (IT) and IT-enabled Services (ITeS) through the automatic route, the government is considering eliminating the security gaps through a stringent scrutiny mechanism.
The Department for Promotion of Industry and Internal Trade (DPIIT) has proposed an online filing of advance foreign investment returns on the Foreign Investment Facilitation Portal (FIFP), which will be accessible to the Reserve Bank of India (RBI), the Ministry …

April 8, 2020 / Foreign Investment

FDI in Construction Development sector in India

The Construction/ Real Estate sector is one of the most critical sectors of the Indian economy due to its huge multiplier effect on the economy. Any impact on the Real Estate sector has a direct bearing on economic growth. Due to the well-acknowledged need for foreign investments into this sector because of the sheer demand, the Foreign Direct Investment (FDI) route has attracted foreign investors’ interest in this sector.

In the year 2005, Reserve Bank of India (RBI) issued a …

April 8, 2020 / Foreign Investment

How to Set up Project Office in India?

‘Project Office’ means a place of business to represent the interests of the foreign company executing a project in India but excludes a Liaison Office.

The project office is the ideal method for companies to establish a business presence in India, if the object is to have a presence for a limited period of time. It is essentially a branch office set up with the limited purpose for executing a specific project. Foreign companies engaged in turnkey construction or installation …

April 8, 2020 / Foreign Investment

How to Set up Branch/ Liaison Office in India

Recently, India has been growing at an unprecedented pace which has aroused a keen interest among foreign entities to establish their operations in India and tap into one of the largest and fastest growing market, and have access to some of the best human resources in the world.

A physical presence in India is essential to break into the country’s emerging market.

Foreign companies should consider state regulations, physical connectivity, and local costs when choosing a location for their Indian

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April 8, 2020 / Foreign Investment

Options for foreign companies setting up business in India

As a market, India has always been attractive to foreign companies because of the rapidly growing market. But in terms of actually taking steps to register a company in India, many foreign companies shelved their plans because of the perceived difficulties in doing the necessary paperwork. Over the last few years, however, many steps have been taken to increase the ease of doing business in India, and foreign companies are being encouraged to have a footprint in India. In …

April 8, 2020 / Foreign Investment

2018 Witnesses Highest FPI Registrations in Four Years

Easier regulations, clamp down on offshore derivative instruments, and Indian equities outperforming other markets in the last few years have boosted foreign investors’ interest in the country, leading to a spurt in the number of foreign portfolio investors (FPI) this year. Over 600 new FPIs registered with Securities and Exchange Board of India (Sebi) in 2018 — the steepest rise in FPI count since 2014, when the market regulator overhauled rules for offshore investors and introduced the FPI regime. There …

April 8, 2020 / Foreign Investment

Legal Shield in the Works for Foreign Investments

The civil aviation ministry is likely to approach the Goods and Services Tax(GST) Council soon for bringing aviation turbine fuel(ATF) under the tax regime.
Current India is working on a framework that will provide legal backing for a stable and predictable foreign investment regime in the country as it looks to attract more capital to help create jobs and accelerate economic growth.
The law that is in the works in the finance ministry is aimed at promoting and protecting foreign …