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100% FDI PERMITTED IN FREE TRADE AND WAREHOUSING ZONES
Date : 10 Dec 2004
Location : New Delhi
The government has put in place a liberal and transparent policy under which foreign direct investment (FDI) up to 100% is permitted in Free Trade and Warehousing Zones; the development of townships within the Special Economic Zones (SEZs); construction and maintenance of roads & highways and ports & harbours; electricity generation, transmission & distribution (except atomic reactor plants). FDI up to 100% is permitted in trading companies engaged in bulk imports with ex-port/ex-bonded warehouse sales. No policy decision has been taken with regard to FDI in the Pension Sector. FDI is not allowed in retail trading. Shri Kamal Nath, Union Minister of Commerce & Industry, replied to a Starred question in Lok Sabha today.
FDI depends upon a number of factors, both external, such as the macro-economic environment in the host economy, global economic environment, corporate strategy of transnational corporations and economic environment in other economies competing for FDI.
The decision to open various sectors to FDI takes into consideration, inter-alia, the objectives of promoting economic growth, encouraging investment, technological upgradation and increased competitiveness.
FDI in India as reported by the Reserve Bank of India was US $ 6.13 billion in 2001-02; US $ 4.66 billion in 2002-03; and US $ 4.67 billion in 2003-04. According to UNCTAD’s World Investment Report 2004, FDI in China was US $ 46.88 billion in 2001; US $ 52.74 billion in 2002 and US $ 53.50 billion in 2003.
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