Lok Sabha Question No. 1795 (UNSTARRED), answered on 2020-09-21
Subject: Promotion of FDI
Ministry: COMMERCE AND INDUSTRY
Asked by: Gopal Chinayya Shetty

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE

## LOK SABHA

UNSTARRED QUESTION NO. 1795. TO BE ANSWERED ON MONDAY, THE 21 ST   SEPTEMBER, 2020.

## PROMOTION OF FDI

## 1795.  SHRI GOPAL CHINNAYA SHETTY:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state: वाणिज्य एवं उद्योग मंत्री

- (a) the details of the measures taken to promote Foreign Direct Investment (FDI);
- (b) whether big industries/groups are the main beneficiaries of FDI reforms;
- (c) if so, the details of the foreign companies that invested in India during the last three years along with the sectors in which they invested and the names of their Indian associates;
- (d) the  investments  made  by  the  foreign  companies  in  small  and  medium enterprises (SME) during the last three years;
- (e) the measures taken to promote FDI in SME sector; and
- (f) the steps taken to encourage foreign investment to use the internal resources and  inputs  instead  of  bringing  them  from  abroad,  except  technology  along with the details of terms and conditions of FDI?

## ANSWER वाणिज्य  एवं उद्योग मंत्री (श्री पीयूष गोयल) THE MINISTER OF COMMERCE & INDUSTRY (SHRI  PIYUSH GOYAL)

- (a): Government  has  put  in  place  a  liberal  and  transparent  policy  for  Foreign Direct Investment (FDI), wherein most of the sectors are open to FDI under the automatic route. The Government reviews the FDI policy on an ongoing basis and makes changes from time to time, to ensure that India remains an attractive & investor friendly destination. It has been the endeavor and intent of  the  Government  to  put  in  place  an  enabling  and  investor  friendly  FDI Policy.
- (b): FDI policy is an enabling policy which is uniformly applicable in the country across all scales of industries including small and medium enterprises.
- (c) & (d): Details  of  Foreign  Direct  Investment  is  maintained  remittance-wise. The Foreign Direct Investment Equity Inflow data inter-alia includes the name  of  the  Foreign  company,  Indian  company  including  MSMEs, country, sector activity, amount and type of investment, etc.  This data is very voluminous and available on the departmental website (www.dipp.nic.in).
- (e) & (f): India  has  one  of  the  most  liberalized  FDI  policy  worldwide,  wherein 100%  FDI  under  automatic  route  is  permitted in many  sectors/ activities.  There  are  only a  few  sectors/ activities  where  FDI  is regulated i.e. subjected to government approval, with a  cap or having other conditionality requirements. The FDI policy equally applies to the MSME sector. Further, the Government reviews the  FDI policy on an ongoing  basis  and  significant  changes  are  made  in  the  FDI  policy regime,  from  time  to  time,  to  ensure  that  India  remains  increasingly attractive and is viewed as an investor-friendly investment destination. A  liberalised  FDI  Policy  is  being  pursued  to  ensure  that  along  with attracting  investment, modern and cutting edge technology is brought in the country to improve overall productivity and competitiveness.

Further,  the  extant  FDI  Policy  on  Single  Brand  Product  retail  trading contributes  significantly  to  the  development  of  MSME  sector  thereby encouraging increased sourcing of goods from India, thereby enhancing  competitiveness  of  Indian  MSMEs,  providing  access  to global designs, technologies and management practices.

FDI Policy on Single Brand Product retail trading, in case of proposals involving foreign investment beyond 51%, mandates sourcing of 30% of the value of goods procured, to be done from India, preferably from MSMEs, village and cottage industries, artisans and craftsmen, in all sectors.

Further, the FDI Policy on Multi Brand Retail Trading provides that, at least  30%  of  the  value  of  procurement  of  manufactured/processed products  purchased  shall  be  sourced  from  Indian  micro,  small  and medium industries, which have a total investment in plant & machinery not exceeding US $ 2.00 million.

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