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Government has put in place a liberal, transparent and investor friendly FDI policy. The latest revision to further liberalise the FDI regime are as under :
- Increase in the FDI limits in “Air Transport Services (Domestic Airlines)” up to 49 per cent through the automatic route, and up to 100 per cent by non-resident Indians (NRIs) through the automatic route.
- Foreign investment in the banking sector has been further liberalised by raising FDI limit in private sector banks to 74 per cent.
- FDI ceiling in telecom sector has been increased from 49 per cent to 74 per cent.
- The guidelines pertaining to foreign/technical collaborations under automatic route for foreign financial/technical collaborations with previous ventures/tie-ups in India as per Press note No.18 (1998) have been reviewed in order to allow new proposals for foreign investment/technical collaborations under the automatic route, subject to sectoral policies and guidelines.
According to World Investment Report-2004, of the United nations Conference on Trade and Development, FDI in India and China during last two years was as under :
(billion of US $)
Year
China
India
2002
52.74
3.45
2003
53.51
4.27
China has a bigger market size due to higher total and per capita GDP, as well as competitive business environment and infrastructure. Further, china has more flexible labour laws and less rigid entry and exist procedures. The factors make china more attractive for FDI.
This information was given by Shri S.S. Palanimanickam, Minister of State for Finance in reply to a question raised by Shri Ravula Chandra Sekar Reddy in Rajya Sabha today.
BSC/BY/CS-196/05
RAJYA SABHA
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