FDI Norms Tweaked by Centre to Prevent Opportunistic Takeovers Amid COVID-19 Pandemic
The transfer of ownership of any existing or future FDI, which may result in changes to the beneficial ownership, will also require the Indian government's approval, said the notification issued by the Department for Promotion of Industry and Internal Trade (DPIIT).
New Delhi, April 18: With Indian corporates reeling under the economic blow of COVID-19 pandemic, the central government has tweaked the Foreign Direct Investment (FDI) norms to prevent opportunistic takeovers. A revised list of guidelines were issued by the Ministry of Commerce and Industries to check the transfer of ownership and surplus investments into industries or sectors by individuals or companies based in bordering nations.
As per the rejigged norms, foreign investment from countries with which India shares land borders will be subjected to strict scrutiny and will be permitted only under the government route. COVID-19 Crisis: Over 100 Countries Seek IMF's Assistance to Combat Economic Fallout.
The transfer of ownership of any existing or future FDI, which may result in changes to the beneficial ownership, will also require the Indian government's approval, said the notification issued by the Department for Promotion of Industry and Internal Trade (DPIIT).
Update by ANI
"However, an entity of a country, which shares land border with India or where the beneficial owner of an investment into India is situated in or is a citizen of any such country, can invest only under the Government route," the DPIIT notification added.
"Further, a citizen of Pakistan or an entity incorporated in Pakistan can invest, only under the Government route, in sectors/activities other than defence, space, atomic energy and sectors/activities prohibited for foreign investment," stated the guidelines.
The Indian economy, which was reeling under a prolonged slowdown since the last fiscal, has come under severe strain amid the COVID-19 pandemic. With a state of nationwide lockdown imposed since March 24, most economic activities barring essential services have been grounded.
(The above story first appeared on LatestLY on Apr 18, 2020 04:25 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).