FDI - GS questions based on daily current affairs

ANSWER: Only 2

Explanation:

• As per FDI Policy 2016, FDI in Animal Husbandry (including breeding of dogs), Pisciculture, Aquaculture and Apiculture is allowed 100% under Automatic Route under controlled conditions. It has been decided to do away with this requirement of ‘controlled conditions’ for FDI in these activities.
• 100% FDI under government approval route is permitted for trading, including through e-commerce, in respect of food products manufactured or produced in India.

ANSWER: Only 2

Explanation:

• Present FDI regime permits 49% FDI participation in the equity of a company under automatic route. FDI above 49% is permitted through Government approval on case to case basis, wherever it is likely to result in access to modern and ‘state-of-art’ technology in the country. In this regard, the following changes have inter-alia been brought in the FDI policy on this sector:
• Foreign investment beyond 49% has now been permitted through government approval route, in cases resulting in access to modern technology in the country or for other reasons to be recorded. The condition of access to ‘state-of-art’ technology in the country has been done away with.
• FDI limit for defence sector has also been made applicable to Manufacturing of Small Arms and Ammunitions covered under Arms Act 1959.

ANSWER: All of the above

Explanation:

• The extant FDI policy on pharmaceutical sector provides for 100% FDI under automatic route in greenfield pharma and FDI up to 100% under government approval in brownfield pharma. With the objective of promoting the development of this sector, it has been decided to permit up to 74% FDI under automatic route in brownfield pharmaceuticals and government approval route beyond 74% will continue.
• The extant FDI policy on Airports permits 100% FDI under automatic route in Greenfield Projects and 74% FDI in Brownfield Projects under automatic route. FDI beyond 74% for Brownfield Projects is under government route. With a view to aid in modernization of the existing airports to establish a high standard and help ease the pressure on the existing airports, it has been decided to permit 100% FDI under automatic route in Brownfield Airport projects.
• It has now been decided to relax local sourcing norms up to three years and a relaxed sourcing regime for another five years for entities undertaking Single Brand Retail Trading of products having ‘state-of-art’ and ‘cutting edge’ technology.

ANSWER: None

Explanation:
- Foreign direct investment norms in the defense sector were changed by allowing FDI up to 49 percent under automatic route and beyond that through the FIPB’s approval.
- The government has also done away with the earlier requirement of mandatory permission from the Cabinet Committee on Security (CCS) beyond 49 percent.
- As per the earlier FDI policy in the sector, foreign investment up to 49 percent was permitted under government approval route.
Portfolio investment and investment by FVCIs were restricted to 24 percent only.

ANSWER: Secretary, Department of Economic Affairs

Explanation:
- The Foreign Investment Promotion Board (FIPB) is a national agency of Government of India, with the remit to consider and recommend foreign direct investment (FDI) which does not come under the automatic route.
- It provides a single window clearance for proposals on FDI in India.
Foreign Investment Promotion Board (FIPB):
1. Secretary, Department of Economic Affairs is a Chairman
2. Secretary, Department of Industrial Policy & Promotion
3. Secretary, Department of Commerce - Member Secretary (Economic Relation)
4. Ministry of External Affairs – Member
- The Board is empowered to co-opt Secretaries to the Government of India and other top officials of financial institutions, banks and professional experts of industry and commerce, as required.

ANSWER: None

Explanation:
- FDI limit in news channels has been hiked from 26% to 49%.
- In the non-news category, now FDI up to 100% has been allowed without the government’s approval.
- The FDI limit in DTH (direct-to-home) and cable networks has been increased to 100%. Earlier, the limit was 74% in DTH services.

ANSWER: FDI allowed up to 49% under the automatic route

Explanation:
- Foreign investment up to 49% has been allowed under automatic route from the earlier government approved route.
- Proposals for foreign investment in excess of 49% will be considered by FIPB.

ANSWER: To define ambiguity between FDI and FII

Explanation:
The government set up a four-member committee headed by Mayaram to define FDI and FII and remove the ambiguity between them.

ANSWER: All

Explanation:
Composite caps have been suggested for agriculture, manufacturing, airports, real estate, telecom and other sectors. It is not applicable to banks and defense companies.

ANSWER: 49%

Explanation:
No explanation is available for this question!