The Department of Industrial Policy and Promotion (DIPP) issued Press Note No. 6 (2013 Series) on 22nd August, 2013 vide which it made changes in the policy on Foreign Direct Investment (FDI)-Caps and approval routes in various sectors, as contained in paragraph 6.2 of 'Circular 1 of 2013-Consolidated FDI Policy'. The earlier and revised position in the FDI Cap and Approval route is given as under:

1.0. Tea sector including tea plantations (paragraph 6.2.2):

Earlier Position for FDI Cap was 100% and the Entry Route was through Government Approval

As per Revised Position there is no Change in FDI Cap and Entry Route

Note: Besides the above, FDI is not allowed in any other plantation sector/activity.

1.1. Petroleum and Natural Gas (paragraph 6.2.4.2):

Earlier Position for FDI Cap was 49% and the Entry Route was through Government Approval

As per Revised Position there is no Change in FDI Cap, however now the Entry Route is through Automatic Approval

1.2. Defence (paragraph 6.2.6):

Earlier Position for FDI Cap was 26% and the Entry Route was through Government Approval

As per Revised Position there is no Change in FDI Cap, however now the Entry Route up to 26% is through Government Approval and for above 26% approval from Cabinet Committee on Security (CCS) on case to case basis, which ensure access to modern and 'state-of-art' technology in the country.

1.3. Courier Services (paragraph 6.2.10):

Earlier Position for FDI Cap was 100% and the Entry Route was through Government Approval

As per Revised Position there is no Change in FDI Cap, however now the Entry Route is through Automatic Approval

1.4. Telecom Services As per Revised Position the definition of Telecom Services (paragraph 6.2.15) has been revised and the FDI Cap is kept at 100% under which up to 49% will be through Automatic Route and above 49% through Government Approval subject to observance of licensing and security conditions by licensee as well as investors as notified by the Department of Telecommunications (DoT) from time to time.

1.5. As per Revised Position Test Marketing (paragraph 6.2.16.3) has been deleted

1.6. Single-brand product retail trading (paragraph 6.2.16.4):

Earlier Position for FDI Cap was 100% and the Entry Route was through Government Approval

As per Revised Position there is no Change in FDI Cap and now the Entry Route up to 49% is through Automatic Approval and above 49% is through Government Approval.

1.7. Asset Reconstruction companies (paragraph 6.2.17.1):

Earlier Position for FDI Cap was 74% of paid-up capital of ARC (FDI+FII) and the Entry Route was through Government Approval (For FDI)

As per Revised Position the FDI Cap is upto 100% of paid-up capital of ARC (FDI+FII) and the entry route up to 49% is through Automatic Approval and above 49% is through Government Approval

1.8. Commodity Exchanges (paragraph 6.2.17.4.2):

Earlier Position for FDI Cap was 49% (FDI & FII) [Investment by Registered FII under Portfolio Investment Scheme (PIS) will be limited to 23% and Investment under FDI Scheme limited to 26% ] and the Entry Route was through Government Approval (For FDI)

As per Revised Position the FDI Cap there is no change in the FDI Cap, however now the now entry route is through Automatic Approval

1.9. Credit Information companies (paragraph 6.2.17.5.1):

Earlier Position for FDI Cap was 49% (FDI + FII) and the Entry Route was through Government Approval (for FDI)

As per Revised Position the FDI Cap is 74% (FDI + FII) and the entry route is through Automatic Approval

1.10. Infrastructure Company in the Securities Market (paragraph 6.2.17.6.1):

Earlier Position for FDI Cap was 49% (FDI & FII) [FDI limit of 26 per cent and an FII limit of 23 per cent of the paid-up capital] and the Entry Route was through Government Approval (for FDI)

As per Revised Position there is no change in FDI Cap however now the entry route is through Automatic Approval

1.11. Power Exchanges (paragraph 6.2.19.1):

Earlier Position for FDI Cap was 49% (26% FDI +23% FII) and the Entry Route was through Government Approval (for FDI)

As per Revised Position there is no change in FDI Cap however now the entry route is through Automatic Approval

2.0. The above changes were made effective from the date of the Press Note i.e. 22nd August, 2013.

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