FDI IN INDIA

WHAT IS FDI?

FDI can be defined as a cross border investment, where foreign assets are invested into the organizations of the domestic market.

Increase investment level and thereby

increase in income & employment.

Increase tax revenue of government.

Facilitates transfer of technology.

Increase exports and reduce import requirements.

Increase competition and break domestic monopolies.

Improves quality and reduces cost of inputs.

Why countries seek FDI

1995 – World Trade Organization’s general agreement on trade in services, which include both wholesale and retailing services, came into effect

1997 – FDI in cash and carry (wholesale) with 100% rights allowed under the government approval route

2006 – FDI in cash and carry (wholesale) brought under the automatic route

Up-to 51% investment in a single- brand retail outlet permitted

2011 – 100% FDI in single –brand retail permitted 2012, Sep – 51% FDI in multi- brand retail permitted

Government Policies

Background:

1)AUTOMATIC ROUTE: FDI is allowed without prior approval of RBI or government as specified under FDI policy

2)GOVERNMENT ROUTE: FDI is allowed with prior approval of Foreign Investment Promotion Board(FIPB),Department of Economic Affairs , Ministry of Finance.

ENTRY ROUTES FOR

FDI:-

Retail Trading

Atomic Energy

Lottery Business

Gambling and Betting

Housing and Real Estate business

Agriculture

Plantations (Other than Tea plantations)

SECTORS WHERE FDI ISPROHIBITED:-

Policy in Defense sector liberalized and FDI cap raised from 26% to 49%.

100% FDI under automatic route permitted in construction, operation and maintenance in specified Rail Infrastructure projects.

Easing of norms underway for FDI in the Construction Development sector.

Opening up Foreign Direct

Investment in key sectors:-

.”

SINGLe brand RETAIL

Single brand retail is one in which a single item is sold across all outlets. Such as GUCCI, NIKE, ADIDAS.

Multi-brand retail or "Supermarket" is where many items are sold under a single roof. For e.g. Tesco, Carrefour etc.

Multi Brand Retail

Major Retailers in India

Retail formats in India

E TradersShopping Malls

Retail formats in India

Specialty stores

FACTS

At least 10% shares of the company needs to quality as FDI.

Mauritian has been the largest direct investor.

New Delhi and Mumbai are two major cities where FDI inflows is heavily concentrated.

The Indian Cabinet Committee on Economics Affairs (CCEA) is strongly expected to raise the FDI ceiling in the Insurance and Pension sectors.

FDI threshold to 49% in the Insurance sector from the existing limit of 26%, has been submitted to the cabinet for proper approval in the quickest possible period.

Increment in the FDI ceiling in the insurance sector of India, will certainly be highly and greatly appreciated by domestic and foreign insurance companies, for the purpose of expanding and enriching their insurance and re-insurance business.

FDI IN INSURANCE SECTOR

FDI IN BROADCASTING

SECTOR Liberalize the broadcasting sector of India to

FDI, the Indian in Cabinet Committee on Economic Affairs(CCEA) raised the FDI cap from 49% to 74% many field of broadcasting sectors. CCEA opted to retain the existing cap of 26% in the fields of TV news channels and FM radio.

Farmers get greater share of consumer’s pay,

Retailers directly source goods from farmers,

Integrating Indian farmers in

Global Supply-Chain.

HOW FARMERS GET Benefited?

• Wastage and Storage problems will be resolved,

• Efficient logistics, production, and distribution

channels,

• Digital records, Infrastructure,

Distribution and warehousing technologies.

Advancement of Technology

• Creating at least 10 million jobs in

Agro-processing,

Manufacturing,

Logistics.

• Improvement in the quality of employment,

• Estimating 50% of jobs in rural areas,

• 30% of inputs from Medium-size & Small enterprises.

Opportunity for Employment

Safety & quality,

High shopping experience,

Upgradation of lifestyle & fashion of

people,

Awareness of International Brands.

SATISFIED CONSUMER

Crowing of local industry.

Conflicts of law.

Loss of control.

Effect on notional environment.

Effect on culture.

Negative Impacts

Presented by Chinmay Tutorials CS professional Students:

Lokesh

Sachin

Deepika

Deepank

Poorva

Pinky

ANY QUESTIONS???