Global Trade Alert

On 3 June 2015, the Department of Industrial Policy and Promotion published Press Note No. 6 (2015 series) notifying an increase in the FDI limit that can be directly approved by the Foreign Investment Promotion Board (FIPB) from INR 2000 crore (ca. USD 312 million) to INR 3000 crore (ca. USD 469 million). 
 
There are two routes for FDI to enter India: the automatic route and the approval route. Under the automatic route, investments up to the specified shareholding limit are approved automatically and only require a notification to the Reserve Bank of India. There is no value cap for investments which go through the automatic route.
Under the approval route, investments up to the specified limit require express approval from the FIPB and/or the Cabinet Committee on Economic Affairs (CCEA). Prior to June 2015, investments up to INR 2000 crore could be approved by FIPB directly while investments above that limit were forwarded to the CCEA for approval. Going forward, the limit of investments that could be approved directly by FIPB is increased to INR 3000 crore and only investments above this limit require an approval from the CCEA.
 
* INR to USD conversion as of 12 June 2015 @ INR 63.92/USD