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Investment Facilitation Portal: FDI's Eligible Investors

  • January 07, 2023
  • Registrationwala
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To gain Foreign Investment Approval from the Government of India, the FDI applicant must file an application on the Foreign Investment Facilitation Portal in this regard. The applicant must file the FDI application at the dedicated FIFP portal along with the required documentation. But before applying for the application, every Investor must check their eligibility for the investor facilitation portal. For their ease, we have detailed all the eligible investors who can file the FDI application with the Indian Authorities for the FIFP portal.

NRI as an Eligible Investor

A non-resident entity can invest in India. But it is subject to the FDI Policy. The exception to this lies in those sectors or activities which are prohibited. However, an entity of India, or sharing a land border with India, or if the beneficial owner of an investment is situated in or is a citizen of the country, can invest only as per the Government route.

NRI from Pakistan: What are the provisions?

Furthermore, a citizen of Pakistan or an incorporated entity in Pakistan can invest but only under the Government route. It must be in sectors or activities other than any of the following:

  • Defense
  • Space
  • Atomic Energy
  • Activities prohibited for FDI Investment

For transfer of ownership of any existing/future FDI in an entity, both directly or indirectly, can result in beneficial ownership. Therefore, it will fall within the restriction of a subsequent change in beneficial ownership. But it will also require the Government's approval.

NRIs from Nepal and Bhutan

NRIs residents, as well as citizens of Nepal and Bhutan, are permitted to invest capital in Indian companies on a repatriation basis. But, it is subject to the condition that the amount of consideration for investment shall be paid only in one way. This way is inward remittance in free foreign exchange. Such remittance can be through normal banking channels.

OCBs and NRIs

In India, OCBs have been derecognized as a class of investors in India from September 16, 2003. As a result, the OCBs incorporated outside India and not under the adverse notice of RBI can make fresh investments. But these investments can be made as incorporated non-resident entities. All the procedures will be held out by the FDI Policy and Foreign Exchange Management (Non-Debt Instrument) Rules of 2019.

Corporate Entities as Eligible Investors

A company, Trust, and Partnership Firm incorporated outside India and owned and controlled by NRIs can invest in India with the special dispensation available to NRIs under the FDI Policy. In addition, foreign Portfolio Investors or FPIs can make investments subject to the terms specified in the Foreign Exchange Management (Non-Debt Instruments) Rules of 2019.

Foreign Investments through a Broker

Registered FPIs and NRIs can invest through a Registered Broker. It can be done in the capital of Indian Companies recognized on Indian Stock Exchanges. It is applicable as per the Schedule of the Foreign Exchange Management (Non-Debt Instruments) Rules of 2019. Such rules can be amended from time to time by the Authority.

Foreign Venture Capital Investor

A Foreign Venture Capital Investor can make investments subject to the terms specified in the Schedules of the Foreign Exchange Management (Non-Debt Instruments) Rules of 2019. An NRI or an OCI can also subscribe to National Pension System. The NPS is governed and administered by Pension Fund Regulatory and Development Authority. Such subscriptions are made through normal banking channels. The person eligible to invest must be defined in the provisions of the PFRDA Act. The annuity/accumulated savings under the scheme is repatriable.

To know more about the FIFP approval and provisions, connect with the FDI experts from the Registrationwala.

 

 


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