ANNOUNCEMENT 04 Sep 2009In September 2009, the government of India announced altered domestic business conditions for foreign investors.
NUMBER OF INTERVENTIONS
See relevant Press Notes at http://dipp.gov.in/English/policy/pressnotes_main.aspx
In three Press Notes (No. 2, 3, and 6) the Indian Ministry of Commerce and Industry has sought to clarify the implementation of various aspects of that nation's foreign investment regime. Specific attention was given to the calculation of indirect foreign investment holdings (No 2.) and the terms under which transfer of ownership or control from a resident Indian to non-resident entities (No. 3). Press Note No. 6 sought to clarify the rules concerning foreign investment into small scale industrial undertakings and micro and small enterprises, as well as for the conditions under which an industrial firm can manufacture products otherwise reserved for small scale industrial undertakings and micro and small enterprises.
An evaluation of these Press Notes does not suggest that the treatment of foreign investors has worsened. While some private sector commentators have suggested that these Notes do not clarify every potential contigency or matter, the GTA assessment is that these Notes add to the transparency of the Indian foreign investment regime.