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The government today decided to liberalise foreign direct investment norms for NRIs and overseas citizens of India (OCI) as it aims to increase capital flows into the country.
A decision in this regard was taken by the Cabinet Committee on Economic Affairs, headed by Prime Minister Narendra Modi.
The Cabinet “approved amendments to FDI policy on investments by NRIs, PIOs & OCIs. This will give PIOs & OCIs parity with NRIs in eco & edu (economy and education),” an official spokesperson said.
“The amendment in FDI for OCIs , NRIs & PIOs will lead to greater forex remittances & investment,” he added.
As per the DIPP’s proposal any investment made by NRIs, OCIs and PIOs from their rupee account in India, will not be treated as foreign investment.
An official said that the non—repatriable NRI funds would be treated as domestic investments.
The government wants to channelise the funds of NRIs, who now have set up large businesses abroad, by treating non—repatriable investments by NRIs as domestic investment.
NRI is defined as a person who is residing outside India but has Indian citizenship.
The Narendra Modi—led government, which has liberalised the FDI policy for sectors such as defence, railways, construction development, medical devices and insurance, is keen to tap NRIs, OCIs and PIOs.
During the April—February period of the previous fiscal, FDI rose by 39 per cent to $28.81 billion as against $20.76 billion in the same period last fiscal.
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