The Directorate of Industrial Policy and Promotion – the foreign investment think tank within the Ministry of Commerce and Industry has updated the FDI policy on Monday. This is the sixth annual updation of the policy since the Consolidation FDI Policy was launched in 2010. The latest updates bring the changes brought during the last one year and as a whole it shows that nearly 90% of the FDI are now allowed through automatic route. Besides the existing provisions, the revised policy brings a clear regulation on FDI in startups. FDI in startups According to the Policy, start-ups can mobilise funds in the form of FDI by issuing various instruments. The Policy s
Japanese tech cum investment firm Softbank will inject $2.5 billion into the home-grown ecommerce firm Flipkart. Decision of the Masayoshi Son owned SoftBank to add capital to Flipkart will enliven competition and rivalry with Jeff Bezos’s Amazon. In the last few quarters, Flipkart was struggling against a multiple platform oriented Amazon though the Indian firm has higher market share. Huge sales campaign and quick addition of local flavor have made the US company an edge over the domestic firm. Bezos’ entry into food retail business has added strength to the potential of Amazon and it seemed that the US firm is quickly closing in with Flipkart. The latest ext
World’s largest handset maker - Apple was offered import tax concessions by the central government for its India manufacturing facility. According to reports by Reuters, the Cupertino based phone maker has to increase its domestic component sourcing in a phased manner to avail the tax concession. Apple demanded tax concession of different types ever since the CEO Tim Cook originally made the proposal for handset manufacturing in Asia’s fastest growing handset market. Several of its demands were rejected by the government as such concession will led to similar demand from other firms. Midway, Apple demanded a 15-year tax holiday for all components it would import for t
Foreign Direct Investment has registered a smart growth of 18% to reach $46 billion during calendar year 2016. According to the data published by Directorate of Industrial Policy and Promotion (DIPP), Foreign Direct Investment was $39.32 billion during 2015. Smart growth in FDI is a good sign for the economy when global FDI flows are declining. According to UNCTAD, FDI flows to India were $42 bn in 2016 whereas that to China was $139 bn. Sectors including services, telecom, trading, computer hardware and software attracted most of the FDI flows. Main sources of FDI were Singapore, Mauritius, the Netherlands and Japan. The first three are known tax concession countries who enjoys
India’s economic administrators’ attack on inconsistent credit rating standards of western agencies is now joined by the Chinese media. An article published in the partisan tabloid – the Global Times ‘Why India’s sovereign ratings lag behind China’, describes that foreign companies are correct in giving high ranking to China over India. India’s Economic Survey brought out a box criticizing the methodology of credit rating agencies. Edited by Arvind Subramanian, the Survey made a comparative study of ratings on India and China while concluding that China gets a higher rating despite macro indicators are more or less the same. According to
The FDI approvals in future will be examined by the concerned Ministries and sectoral regulators after the abolition of Foreign Investment Promotion Board (FIPB). Finance Minister in his budget speech has indicated winding up of the operations of FIPB as nearly 92% of the FDI proposals are now made through automatic route. The FIPB was created in 1996 as the designated institution for considering FDI proposals that require government approval. It also grants composite approvals involving foreign investment/ foreign technology. End of FIPB also indicate the progress of foreign investment reform as well as depth of opening up of the economy to foreign investors. Still, nearly eight
Just two year after its India entry, Chinese mobile phone manufacturer- Xiomi has achieved Rs 7000 crore sales. Another Chinese firm Huawie has reached Rs 10000 crore and several other smaller Chinese firms are also well performing compared to their achievements back at home. Apple, the leader in the global market is here for a long time and its sale is stagnating at around Rs 10000 crore. Xiomi’s silent but rapid march shows that it has the price attraction and product quality that can win Indian hearts. India is world’s fastest growing mobile phone market and is growing at smart pace. Apple’s problems lie in its products as it has no product to compete in Indi
Government has called a meeting of the top officials of various ministries to look into the demands sought by Apple to start its manufacturing facility in India. the Cupertino based electronic giant has several manufacturing facilities and assembly lines in different countries; but not much production presence in India which is a fast-growing market for iPhones. Senior officials from DIPP (Department of Industrial Policy and Promotion), revenue, environment, forest etc. are scheduled to meet in January to consider various Apple demands including tax concessions and other incentives. Apple is expected to make a market seeking type of manufacturing facility in India as it fears to
Rupee is trading at new lows early morning in the context of strengthening dollar. Besides the news of sooner than expected interest rate hike in the US has also put pressure on rupee. What triggers a potential interest rate stance by the Fed is the rising US inflation. Early morning session on Thursday, the rupee registered 68.74 a dollar, down 0.23% from its previous close of 68.57. It is on the brink of the all-time low of 68.85 to the dollar. The Fed has already indicated its desire to move towards raising its policy rate called the Fed rate. This event is expected soon so as to match the rising inflation rate. At present, the US bond market is witnessing heavy selling
India and Japan signed the much-anticipated civil nuclear cooperation agreement that will fasten India’s nuclear energy projects. The agreement will promote nuclear energy projects in India and is an indication of the country’s ability to support nuclear energy projects despite an outsider of the NSG. "This agreement is a legal framework that India will act responsibly in peaceful uses of nuclear energy and also in Non-Proliferation regime even though India is not a participant or signatory of NPT," Modi said referring to the significance of the agreement for India as the country is not a member of the NSG. Prime Minister Modi and his Japanese counterpart signed the a
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