Overview
Permitted Sectors
Prohibited Sectors
Foreign Direct Investment in LLP
Foreign Direct Investment (“FDI”) and the mechanisms (both substantive and procedural) governing its inflow into India are regulated by the policies of the GoI and subjected to review on an ongoing basis. The GoI decided that a consolidated circular would be issued every year to update the FDI policy. The latest FDI Policy (circular 1 of 2013), which is effective from April 5, 2013 (“Consolidated FDI Policy”), reflects the current policy framework on FDI, summarised for ready reference.
Permitted Sectors with no Government Approval required
- Within Sectorial Caps
- Sectors do not fall in the category of Strategic importance
Permitted Sectors with Government approval through Foreign Investment Promotion Board required
- Limits exceed Sectorial Caps
- Sectors of Strategic Importance
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Agriculture & Animal Husbandry only in specified areas |
100% |
Automatic |
2 |
Tea Plantation |
100% |
Automatic up to 49% Government route beyond 49% and up to 100% |
Mining & Petroleum & Natural Gas
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Mining of metal |
100% |
Automatic |
2 |
Coal & Lignite mining for captive |
100% |
Automatic |
3 |
Setting up coal processing plants |
100% |
Automatic |
4 |
Mining and mineral separation of titanium bearing minerals and ores, its |
100% |
Government |
5 |
Petroleum & Natural Gas Exploration activities of oil and natural gas fields, infrastructure related to marketing of petroleum products and natural gas, marketing of natural gas and petroleum products, petroleum product pipelines, natural gas/pipelines, LNG Regasification infrastructure, market |
100% |
Automatic |
6 |
Petroleum refining by the Public Sector Undertakings (PSU), without any disinvestment or dilution of domestic equity in the existing PSUs |
49% |
Automatic |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Manufacture of items reserved for production in Micro and Small Enterprises (MSEs) |
As per secrtorial cap |
- |
2 |
Defence Industry subject to Industrial license under the Industries |
26% |
Upto 26% Government, Above 26% - Cabinet Committee on Security approval |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Broadcasting Carriage Services Teleports setting up of uplinking HUBs/ Teleports, DTH |
74% |
Automatic upto 74% |
2 |
Broadcasting Carriage Services Cable Networks (Multi System operators (MSOs) operating at |
49% |
Government route beyond 49% and up to |
3 |
Cable Networks (Other MSOs not undertaking upgradation of networks |
49% |
Automatic |
4 |
Terrestrial Broadcasting FM (FM Radio) |
26% |
Government |
5 |
Up-linking of ‘News & Current Affairs’ TV Channels |
26% |
Government |
6 |
Up-linking of Non-‘News & Current Affairs’ TV Channels/ |
100% |
Government |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Publishing of Newspaper and periodicals dealing with news and current affairs |
26% |
Government |
2 |
Publication of Indian editions of foreign magazines dealing with news and current affairs |
26% |
Government |
3 |
Publishing/printing of Scientific and TechnicalMagazines/specialty journals/ periodicals |
100% |
Government |
4 |
Publication of facsimile edition of foreign newspapers |
100% |
Government |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Airports - Greenfeild projects |
100% |
Automatic |
2 |
Airports - Existing projects |
100% |
Automatic up |
3 |
Air Transport Services - Scheduled Air Transport Service/ |
49% FDI |
Automatic |
4 |
Non-Scheduled Air Transport Service |
74% FDI |
Automatic up to 49% |
5 |
Helicopter services/seaplane services requiring |
100% |
Automatic |
6 |
Ground Handling Services subject to sectoral regulations and security clearance |
74% FDI |
Automatic up |
7 |
Maintenance and Repair organizations; flying training institutes; and technical training institutions |
100% |
Automatic |
Construction Development: Townships, Housing, Built-Up Infrastructure
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Construction Development: Townships, Housing, Built-up infrastructure |
100% |
Automatic |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Industrial Parks – new and existing |
100% |
Automatic |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Telecom services (including Telecom infrastructure providers Cat - I) |
100% |
Automatic up to 49% |
2 |
(a) ISP with gateways |
74% |
Automatic up |
3 |
(a) Infrastructure provider providing dark fibre, right of way, duct space, tower (IP Category I) |
100% |
Automatic up |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Cash & Carry Wholesale Trading/ Wholesale Trading (including sourcing from MSEs) |
100% |
Automatic |
2 |
E-commerce activities |
100% |
Automatic |
3 |
Single Brand product retail trading |
100% |
Automatic up to 49% |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Satellites – Establishment and operation |
74% |
Government |
2 |
Private Security Agencies |
49% |
Government |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Asset Reconstruction Companies |
Upto 100% (FII+FDI) |
Automatic up to 49% |
2 |
Banking Private Sector |
74% including |
Automatic up |
3 |
Banking- Public Sector |
20% (FDI and |
Government |
4 |
Commodity Exchanges |
100% |
Automatic |
5 |
Credit Information Companies (CIC) |
74% (FDI + FII) |
Automatic |
6 |
Infrastructure Company in the Securities Market |
100% |
Automatic |
7 |
Insurance |
26% |
Automatic |
8 |
Non-Banking Finance Companies (NBFC) |
100% |
Automatic |
Sr No |
Sector / Activity |
% of FDI |
Entry Route |
1 |
Pharmaceuticals – Greenfeild |
100% |
Automatic |
2 |
Pharmaceuticals – Brownfeild |
100% |
Government |
3 |
Power Exchanges |
100% |
Automatic |
- Lottery Business including Government / private lottery, online lotteries, etc.
- Gambling and Betting including casinos etc.
- Chit funds
- Nidhi company
- Trading in Transferable Development Rights (TDRs)
- Real Estate Business or Construction of Farm Houses
- Manufacturing of Cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes
- Activities / sectors not open to private sector investment e.g. (I) Atomic energy and (II) Railway operations (other than permitted activities mentioned in entry 18 of Annex B)
Note: Foreign technology collaboration in any form including licensing for franchise, trademark, brand name, management contract is also prohibited for Lottery Business and Gambling and Betting activities.
Prohibited Sector
- agricultural/plantation activity
- print media
- real estate business
- Downstream investment by LLPs with FDI
- Investment by Foreign Institutional Investors (FIls) and Foreign Venture Capital Investors (FVCIs)
- ECBs
Permitted Sectors
- Downstream by Indian Company with FDI, if both LLP and Company are operating in 100% FDI allowed sector and there is no FDI linked performance condition
- In LLP’s operating in sectors/activities where 100% FDI is allowed through automatic route and there are no FDI linked performance condition