Foreign Investment Rules
Q. Which of the following is/are true?
1) A citizen of Bangladesh or an entity incorporated in Bangladesh can invest through automatic route in India.
2) As of yet now a citizen of Pakistan or an entity incorporated in Pakistan cannot invest in India.- Published on 03 May 16a. Only 1
b. Only 2
c. Both 1 and 2
d. Neither 1 nor 2
ANSWER: Neither 1 nor 2
- Steps have been taken to open up more FDI in key areas like insurance, construction, defence, railways and medical devices. Procedures are being simplified and digital technology is being used to eliminate multiple approvals. A predictable, stable and competitive tax regime is being built.
- As per the extant FDI policy, any non-resident entity can invest in India, subject to the FDI Policy except in those sectors/ activities which are prohibited.
- However, a citizen of Bangladesh or an entity incorporated in Bangladesh can invest only under the Government route.
- Further, a citizen of Pakistan or an entity incorporated in Pakistan can invest, only under the Government route, in sectors/ activities other than defence, space and atomic energy and sectors/ activities prohibited for foreign investment.
