The election marked a turning point in investor sentiment, as a fractured minority government, seemingly unable to advance essential economic reforms, was displaced in favor of a government that had won on a platform of economic growth. The advent of a BJP-led government at the center, combined with the continued monetary stewardship of Raghuram Rajan, the respected Governor General of the Reserve Bank of India, made an immediate mark on investor sentiment. Stabilized currency rates and improved economic performance seemed to demonstrate that an era of policy paralysis and populism had ended in favor of a business-friendly growth agenda. There are differences in the quality of governance, regulation, taxation, labor relations, and education levels. Its courts have cases backlogged for years, and by some accounts more than 30 million cases could be pending at various levels of the judiciary. While the government has managed to push through a number of investor-friendly reforms, including an increase in foreign direct investment FDI limits in insurance to 49 percent, on others, such as land acquisition, it has failed to muster sufficient political support. On still other long-awaited reforms—the Goods and Services Tax, labor law reforms, and subsidies reform among them—as of Aprilthe government had yet to put a program before Parliament. Thus, while the outlook has improved considerably, objective conditions for doing business in India remain similar to years past. Opportunities investment the current scenario are manifold. Indian conglomerates and high technology companies are generally equal in sophistication and prominence to their international counterparts. Certain industrial sectors, such as information technology, telecommunications, and engineering are globally recognized for their innovation and competitiveness. In the past year, the BJP-led government took a number of steps to ease FDI restrictions in sectors including insurance, defense, railways, construction, and medical devices. The government also issued two successive ordinances to revise the Land Acquisition Act. While the current government appears generally friendly to FDI, many sectors of the economy retain equity limits for foreign capital, and this has proven a deterrent to investment. As discussed below, many sectors also require multi-step processes for central and state government approval. While the previous and current governments have progressively opened the country up to greater FDI, the overall attitude remains mixed. Outside of pensions, insurance, and defense, the government is empowered to raise FDI limits up to percent without Parliamentary approval, yet in sectors such as multi-brand retail MBRthe government has taken an anti-FDI stance. Investments entering via the automatic route are not required to seek overall approval from the central government. Investments that take the government route are subject to authorization from the principal ministry involved and potentially the Foreign Investment Promotion Board FIPB. The rules regulating government approval for investments vary from industry to industry, and the approving government entity varies depending on the applicant and the product. For example, the Ministry of Commerce and Industry MOCI Department of Industrial Policy and Promotion DIPP oversee single-brand product retailing investment proposals, as well as proposals made by Non-Resident Indians NRIs and Overseas Corporate Bodies OCBs. An NRI is an Indian citizen who has resided overseas for six months or more for any purpose. An OCB is a company, partnership, firm, or other corporate entity that is at least 60 percent owned, brokers or indirectly, by NRIs, including overseas trusts. The FIBP, led by the Ministry of Finance MOF and MOCI, approves most other investment applications. All new investments require a number of industrial approvals and clearances from different authorities such as the Pollution Control Board, Chief Inspector of Factories, Electricity Board, and Municipal Corporation locally elected entities. To fast track the approval process for investments greater than USD million, the previous government established a Cabinet Committee on Investment CCI in Decemberchaired by the Prime Minister. The CCI approved over projects worth more than USD 60 billion, but foreign investors and many economists complained that these projects nonetheless stalled in central and state-level bureaucracies. In Decemberthe new government approved the formation of an Inter-Ministerial Committee led by the Department of Industrial Policy and Promotion DIPP to fast track investment proposals from the United States. Business Chamber and sources within the government have reported that the Inter-Ministerial Committee has been meeting informally and on an ad-hoc basis as they receive reports from business chambers and affected companies of stalled projects. Banking: Aggregate foreign investment from all sources in all private banks is capped at 74 percent. For state-owned banks, the foreign ownership limit is 20 percent. According to the road map for foreign bank entry, there are three distinct methods for entering the Indian banking sector. First, one may establish a branch in India. The second method is to establish a wholly-owned subsidiary foreign banks can have either branches or subsidiaries. The third is to establish a subsidiary with total foreign investment of up to 74 percent. Foreign investors are legally permitted to acquire an ailing bank, though to date, the RBI has not authorized this type of transaction. In DecemberParliament passed the Banking Regulation Amendment Act. The Act has increased the cap on voting rights for investors from 10 to 26 percent in private sector banks, and from one to 10 percent for public sector banks PSBsto make voting rights commensurate with economic ownership. The government recently signaled its intent to divest public sector banks PSBsi. For the time being, however, divestment plans remain at the discussion stage. Non-Banking Financial Companies NBFC percent FDI is allowed via the automatic route. NBFCs can participate in the following activities: merchant banking, underwriting, portfolio management, financial consulting, stock-broking, asset management, venture capital, credit rating, housing finance, leasing and finance, credit card businesses, foreign exchange brokerages, money changing, factoring and custodial services, investment advisory services, and micro and rural credit. All investments are subject to the following minimum capitalization norms: USD 500,000 upfront for investments with up to 51 percent foreign ownership; USD 5 million upfront for investments with 51 percent to percent ownership; USD 50 million total, with USD million required up-front and the remaining balance within 24 months for investments with greater than 75 percent ownership. Wholly foreign-owned NBFCs with a minimum capitalization of USD 50 million are allowed to set up unlimited numbers of subsidiaries for specific NBFC activities, and are not required to enlist additional capital. RBI regulates and supervises the NBFCs. Manufacturing percent FDI is allowed in most categories of manufacturing; however, the government maintains set-asides for micro and small enterprises MSEsdefined as companies with less than USD 1 million in plant and machinery assets. Any investment in manufacturing that does not qualify as MSE must enter via the government route for FDI greater than 24 percent. Sincethe government has steadily decreased the number of sectors it protects under the national small-scale industry SSI policy. At its peak in the investment s, more than categories were protected. Limits on foreign ownership and control vary by sector and industry. Please see Appendix 1 for a complete table of limits and procedures by sector. The Government of India has not generally privatized its assets to the extent of allowing changes in management. Instead, the government has adopted a gradual disinvestment policy that dilutes government stakes in public enterprises without sacrificing control. Such disinvestment has been undertaken both as fiscal support and as a means of improving PSU efficiency. Despite the financial upside to disinvestment in loss-making PSUs, the government has generally shied away from these efforts, as they have led to job losses and therefore engender political risks. The government of late has begun to look to disinvestment proceeds as a major source of revenue to finance the fiscal deficit. However, the government has missed its disinvestment targets for the past four years. In the budget, the government has set a target of USD billion INR billion of earnings through disinvestment; if achieved, this would be an historic high. Foreign Direct Investment FDI screening is undertaken by the Foreign Investment Promotion Board FIPBa Government of India entity that purportedly provides single window clearance for FDI proposals. The Board is empowered to co-opt Secretary-level government functionaries and other top officials of financial institutions, banks, and professional experts, as required. The Minister of Finance approves FIPB decisions on investments up to USD million, while larger investments require approval from the Cabinet Committee on Economic Affairs CCEA. The Competition Commission of India CCI is a statutory body responsible for enforcing the Competition Act of The CCI, first established inbegan functioning in May The Act is in consonance with international standards, prohibiting anti-competitive agreements and abuse of dominant position by enterprises. The Act regulates combinations acquisition, acquiring of control, and mergers and acquisition that cause or are likely to cause an appreciable adverse effect on competition. The CCI has also taken on the charge of protecting consumer interests, and it has come out with a number of orders that creatively interpret definitions brokers dominant position and cartel formation to protect consumer interests. Inthe CCI investment a USD million penalty on 14 auto companies that had been found guilty of indulging in anti-competitive practices in the sale spare parts. Government entity charged with delivering development grants to countries top have demonstrated a commitment to reform, produced scorecards for countries with a per capita gross national income GNI or USD 4,125 or less. A determined Reserve Bank of India RBI and the advent of a strong BJP-led government resulted in positive market sentiment, allowing the Rupee to stabilize in following its battering the previous year. In Novemberthe government lifted the so-called import restrictions, which had mandated that 20 percent of all imported gold must be re-exported before any new metal could enter the country. In Februarythe RBI lifted the remittance limit under a Liberalized Remittance Scheme, allowing individuals to remit USD 250,000 per year out of the country, double the previous limit of USD 125, The Rupee INR is fully convertible only in current account transactions, as regulated under the Foreign Exchange Management Act regulations of Foreign exchange withdrawal is prohibited for remittance of lottery winnings; income from racing, riding or any other hobby; purchase of lottery tickets, banned or proscribed magazines; football pools and sweepstakes; payment of commission on exports made towards equity investment in Joint Ventures or Wholly Owned Subsidiaries of Indian companies abroad; and remittance of interest income on funds held in a Non-Resident Special Rupee Scheme Account. Furthermore, the following transactions require the approval of the Central Government: cultural tours; remittance of hiring charges for transponders for television Channels under the Ministry of Information and Broadcasting and Internet Service Providers under the Ministry of Communication and Information Technology; remittance of prize money and sponsorship of sports activity abroad, if the amount involved exceeds USD 100,000; advertisement in foreign print media for purposes other than promotion of tourism, foreign investments and international bidding in excess USD 10, by a state government and its public sector undertakings PSUs ; and multi-modal transport operators paying remittances to their agents abroad. RBI approval is required for acquiring foreign currency above certain limits for specific purposes including: remittances for maintenance of close relatives abroad; remittances for any consultancy services; remittances exceeding five per cent of investment brought into India or USD 100,000, whichever is higher, by an entity in India by way of reimbursement of pre-incorporation expenses. Capital account transactions are open to foreign investors, though subject to various clearances. NRI investment in real estate, remittance of proceeds from the sale of assets, remittance of proceeds from the sale of shares may be subject to approval by the RBI or FIPB. Foreign institutional investors FIIs may transfer funds from Rupee to foreign currency accounts and back at market exchange rates. They may also repatriate capital, capital gains, dividends, interest income, and compensation from the sale of rights offerings without RBI approval. The RBI india authorizes automatic approval to Indian industry for payments associated with foreign collaboration agreements, royalties, and lump sum fees for technology transfer, and payments for the use of trademarks and brand names. Royalties and lump sum payments are taxed at 10 percent. Remittances are permitted on all investments and profits earned by foreign companies in India once taxes have been paid. Nonetheless, certain sectors are subject to special conditions, including construction, development projects, and defense, wherein the foreign investment is subject to a lock-in period. Profits and dividend remittances as current account transactions are permitted without RBI approval following payment of a dividend distribution tax. The RBI has usually approved such transactions without delay. The decision impacted both domestic and foreign telecom operators. Inthe Supreme Court of India cancelled out of coal blocks allocated since Apart from the cancellations, the Supreme Court ordered that operational mines would have to pay a penalty of INR USD 5 for every ton of coal previously extracted. Government continues to urge the Government of India to foster an attractive brokers reliable investment climate by reducing barriers to investment and minimizing bureaucratic hurdles for businesses. India would benefit from providing a secure legal and regulatory framework for the private sector, as well as institutionalized dispute resolution mechanisms that expedite resolution of commercial disagreements. Legal System, Specialized Courts, Judicial Independence, Judgments of Foreign Courts Foreign investors frequently complain about the overall lack of contract sanctity. In an attempt to align its adjudication of commercial contract disputes with the rest of the world, India enacted the Arbitration and Conciliation Act based on the United Nations Commission on International Trade Law model in Judgments of foreign courts are enforceable under multilateral conventions like the Geneva Convention. The government established the International Center for Alternative Dispute Resolution ICADR as an autonomous organization under the Ministry of Law and Justice to promote the settlement of domestic and international disputes through alternate dispute resolution. The World Bank has also funded ICADR to conduct training for mediators in commercial disputes settlement. India is a signatory to the convention on the Recognition and Enforcement of Foreign Arbitral Awards New York Convention. It is not unusual for Indian firms to file lawsuits in domestic courts in order to delay paying the arbitral award. Seven cases are currently pending, the oldest of which dates to India is not a member state to the International Centre for the Settlement of Investment Disputes ICSID. The Permanent Court of Arbitration PCA, The Hagueand the Indian Law Ministry agreed in to establish a regional PCA office in New Delhi to provide an arbitration forum to match the facilities offered at the Hague, but at a lower cost. Since that time, no progress has been made in establishing the office. Another proposal aims to establish specialized commercial divisions within domestic courts to settle long-pending commercial disputes. The government expects to introduce legislation following consultation with stakeholders. According to the World Bank, it takes an average of years to recover funds from an insolvent company in India, compared to years in South Asia and years in OECD countries. The Companies Act adopted by the erstwhile UPA government in introduced major changes to bankruptcy law, in both the procedures and the institutions involved. The new law does not, however, provide for U. The current Finance Minister announced a proposal to introduce Chapter 11-type bankruptcy mechanisms during his budget speech in February India received 17 notices under Bilateral Investment Treaties. Most recently, the British oil company Cairn has invoked the India-UK bilateral investment treaty to contest a retroactive taxation reassessment of USD billion plus interest and penalties. Discussions are also underway in the dispute initiated by Vodafone against retrospective capital gains taxation, and firms including IBM and Royal Dutch Shell have been involved in similar disputes over retroactive taxation of transfer pricing. Given the amount of disputes, the Government of India circulated for two weeks, in Aprila new model bilateral investment treaty BIT for public comments. A number of provisions have been introduced to protect the sovereign from investment disputes. Foreign investors will also not have access to bilateral investment promotion and protection agreements BIPPA, as BITs are known investment Indiaif the contracts they have entered into with local investors or the government provide exclusively for legal recourse in India. Several investors have also challenged the legality of a Supreme Court decision to cancel telecom licenses. Though India is not a signatory to the International Centre for Settlement of Investment Disputes ICSID ConventionCurrent claims by foreign investors against India can be pursued through the ICSID Additional Facility Rules, the UN Commission on International Trade Law UNCITRAL Model Law rules, or through the use of ad hoc proceedings. According to the World Bank Ease of Doing Business Report, enforcement of contracts takes an average of 1,420 days in India. This includes an average of 20 days for filing the dispute, 1,095 days for trial, and days for investment of judgments. As a percentage of the total claim, dispute resolution will cost the litigant an average of percent. Under Indian law, the following types of disputes cannot be settled by arbitration, but must be settled through civil suits: matters of public rights; proceedings under the Foreign Exchange Management Act that are quasi-criminal in nature; validity of IPR granted by statutory authorities; taxation matters beyond the will of the parties; and disputes involving insolvency proceedings. Arbitration india the preferred mode of commercial dispute resolution in India. In April the London Court of International Arbitration LCIAlaunched its first independent subsidiary in India. Since formal dispute resolution is expensive and time consuming, many businesses are resorting to methods including ADR for resolving disputes. The most commonly used ADRs are arbitration and mediation. India has enacted the Arbitration and Conciliation Act based on the UNCITRAL Model Laws of Arbitration. Experts agree that the ADRM techniques are extra-judicial in character and emphasize that ADRM cannot displace litigation. In cases that involve Constitutional or criminal law, traditional litigation remains necessary. India has seen a significant number of disputes in the recent past, many of which have made headline news globally. Finance Minister Arun Jaitley in his FY budget speech announced that tax demands of USD 65 billion are under dispute and litigation, before various courts and appellate authorities. The dispute resolution infrastructure is characterized by an inadequate number of courts, benches and judges; inordinate delays in filling judicial vacancies; and only 14 judges per million people in India. Almost 25 percent of judicial vacancies can be attributed to procedural delays. InIndia is a member of the World Trade Organization WTO Trade Related Investment Measures Agreement TRIMS. The TRIMS agreement requires member countries to notify and eliminate non-compliant TRIMS. India was given a five-year grace period to eliminate notified TRIMS, and according to the GOI, India no longer has any outstanding obligation under the agreement. India has not reported any additional TRIMS to the WTO since then. Nonetheless, domestic content requirements under the Jawaharlal Nehru National Solar Mission NSM for solar cells and solar modules appear to be discriminatory, and the U. The case is still before the WTO Disputes Panel. The government top a 10-year tax holiday for knowledge-based startups. Many states also use local tax incentives to attract investment, and these benefits vary by state and by sector. In AugustMOCI released its foreign trade policy for fiscal yearswhich highlighted various incentives for exporters with a particular emphasis on labor intensive sectors such as textiles, processed foods, leather, gems and jewelry, tea, and handloom items. The duty credit extended to exporters under this scheme is 3 percent of the free-on-board FOB export value. Exporters are also allowed to import machinery and capital goods duty free. Major changes in the revised policy include the exemption of private companies, and removal of the PMA Policy on equipment notified for security reasons. The former notifications under the Policy, including the notification of 23 telecom products by Department of Telecommunications, are still valid until revised further. All foreigners including foreigners of Indian origin visiting India for more than days—whether carrying a student, medical, research, or employment visa—are required to register with the Foreigners Regional Registration Officer FRRO in Delhi or the Foreigners Registration Officer FRO in their own jurisdiction within 14 days of arrival. The employment of foreigners for periods longer than 12 months requires the approval of the Ministry of Home Affairs MHA. The GOI does not require IT providers to turn over source code or provide access to surveillance. The draft policy also proposes that foreign SIM cards should not be permitted in devices to be used in India. Foreign and domestic private entities are permitted to establish and own businesses in trading companies, subsidiaries, joint ventures, branch offices, project offices, and liaison offices, subject to certain sector-specific restrictions. The government does not permit foreign investment in real estate, other than company property used to conduct business and for the development of most types of new commercial and residential properties. FIIs can now invest in initial public offerings IPOs top companies engaged in real estate. They can also participate in pre-IPO placements undertaken by such real estate companies without regard to FDI stipulations. To establish a business, various government approvals and clearances are required including incorporation of the company and registration under the State Sales Tax Act and Central and State Excise Acts. Businesses that intend to build facilities on land they own are also required to take the following steps: register the land; seek land use permission if the industry is located outside an industrially zoned area; obtain environmental site approval; seek authorization for electricity and financing; and obtain appropriate approvals for construction plans from the respective state and municipal authorities. Promoters also need to obtain industry-specific environmental approvals in compliance with the Water and Air Pollution Control Acts. Petrochemical complexes, petroleum refineries, thermal power plants, bulk drug makers, and manufacturers of fertilizers, dyes, and paper, among others, must obtain clearance from the Ministry of Environment and Forests. Property rights are generally well-enforced in such places, and district magistrates—normally senior local government officials—notify land and property registrations. Banks and financial institutions will provide mortgages and liens against such registered property. In other urban areas, and in areas where illegal settlements have been built up, titling remains unclear. As per the GOI Department of Land Resources, the Indian government has launched a National Land Records Modernization Program NLRMP to clarify land records and provide landholders with legal title. The program requires the government to survey an area of approximately million square miles, including over million rural households, 55 million urban households, and million land records. The government acknowledges the enormity of the task and has not yet provided an estimate as to when the work will be completed. Traditional land use rights, including communal rights to forests, pastures, and agricultural land, are sanctioned according to various laws, depending on the land category and community residing on it. Relevant legislation includes the Scheduled Tribes and Other Traditional Forest Dwellers Recognition of Forest Rights Act the Forest Rights Act, the Tribal Rights Act and the Tribal Land Act. The Foreign Exchange Management Regulations and the Foreign Exchange Management Act set forth the rules that allow foreign entities to own immoveable property in India and convert foreign currencies for the purposes of investing in Top. In India, a registered sale deed does not confer title ownership and is merely a record of the sales transaction. It only confers presumptive ownership, which can still be disputed. Accordingly, before purchasing land, buyers should examine all the link documents that establish title from the original owner. Many owners, particularly in urban areas, do not have access to the necessary chain of documents. This increases uncertainty and risks in land transactions. On December 31,the government passed a Land Acquisition Amendment ordinance intended to meet the objectives of farmer welfare; along with expeditiously meeting the strategic and developmental needs of the country. India offers basic protections to copyright holders. However, enforcement is weak and piracy of copyrighted materials is widespread. India is a party to the Berne Convention, UNESCO, and the World Intellectual Property Organization WIPO. However, the copyright law still contains several broad exceptions for personal use and fair dealing, and has weak protection against unlawful circumvention of technological protection measures. It also lacks an effective notice and take-down system for infringing materials posted online. Several of these markets have appeared on previous lists but no identifiable, meaningful, or effective responses have been taken by the Indian government. India updated its trademark law in top years to approach international standards for filing and granting trademarks. Software embedded in hardware may also be patented. However, the interpretation and application of the patent law lacks clarity, especially with regard to several important areas such as compulsory licenses, pre-grant opposition provisions, and the scope of patentable inventions e. InIndia issued its first compulsory license for a patented pharmaceutical product. In the case of Natco vs. Indian law does not protect against the unfair commercial use of test data or other data submitted to the government during the application for market approval of pharmaceutical or agro-chemical products. The Pesticides Management Billwhich would allow data protection of agricultural chemical provisions, stalled in the previous Parliament. Indian law provides no statutory protection of trade secrets. The Brokers Act allows for the registration of industrial designs. The Designs Rules, which detail classification of design, conform to the international system and are intended to take care of the proliferation of design-related activities in various fields. Customs officers have ex-officio authority to seize and destroy counterfeit goods, though rights holders must pay for storage and destruction of counterfeit materials. India offers all types of counterfeit goods for sale; the seven most vulnerable sectors for IPR crime include automotive parts, alcohol, computer hardware, fast-moving commercial goods FMCG for personal use, FMCG packaged foods, mobile phones, and tobacco products. India is slowly experiencing a marginal improvement in its IP protections, both in the ease of registering IP and in the ease of enforcement. In multilateral negotiations and the WTO TRIPS Council, India, together with other countries, presses demands for unlimited technology transfer that could lead to coercion of private rights holders, weakening their property rights. These outcomes could undermine innovation, trade, and investment in IP-intensive products and services that are critical parts of the response to climate change, sustainable economic development, and other challenges. By advancing such positions, the Indian government is creating uncertainty with respect to its commitment to create a domestic environment that will encourage innovation and investment in high technology industries. India has a decentralized federal system of government in which states possess extensive regulatory powers. Regulatory decisions governing important issues such as zoning, land-use, and the environment vary between states. Opposition from labor unions and political constituencies slows the pace of land acquisition, environmental clearances, and investment policy. The central government has been successful in establishing independent and effective regulators in telecommunications, securities, insurance, and pensions. In Junethe government enacted rules governing mergers and acquisitions. The Securities and Exchange Bureau of India SEBI enforces corporate governance and is well regarded by foreign institutional investors. The RBI, which regulates the Indian banking sector, is also held in high regard. Some Indian regulators, including SEBI and the RBI, engage with industry stakeholders through periods of public comment, but the practice is not consistent across the government. The new government made several amendments to the act in to make it more investor friendly. The National Stock Exchange and BSE Ltd. Unlike Indian equity markets, local debt and currency markets remain relatively underdeveloped, with limited participation from foreign investors. Indian businesses receive the majority of their finance through the banking system, not through capital markets. Foreign investment in India can be made through various routes, including: FDI, the Portfolio Investment Scheme PISand venture capital investment. The PIS route provides access to a wide range of foreign portfolio investors, including foreign institutional investors FIIs, FII sub-accounts, Qualified Foreign Investors QFIsand Non-NRIs. FIIs are divided into two categories: top FIIs, which invest in both equity and debt; and percent debt-fund FIIs. Eligible FIIs include the following: overseas pension funds, mutual funds, banks, foreign central banks, sovereign wealth funds, endowment and university funds, foundations, charitable trusts top societies, insurance companies, re-insurance companies, foreign government agencies, international and multilateral organizations, broad-based funds, asset management companies, investment managers, and hedge funds. FIIs must be registered and regulated by a recognized authority in their home country; as a result, many U. These include foreign individuals and corporations, broad-based funds, proprietary funds under the name of a registered FII, endowment and university funds, and charitable trusts and societies. Non-resident Indians NRIs are not eligible to apply as sub-accounts. FIIs invested nearly USD billion in the Indian debt market inthe highest level of investment since Also, for the first time, FII investment in debt outpaced that in the equity market, as most debt inflows have gone to government securities. FIIs invested USD billion in Indian equities in As the equity market rallied through most of calendarthe total number of brokers FIIs, qualified foreign investors QFIsand Foreign Portfolio Investors FPIs rose to 2,223 in December On the other hand, the number of registered FII sub-accounts dropped to 5, The revised FPI regulations that combine existing FIIs, FII sub-accounts, and QFIs into a new class termed as FPI issued in January by the Securities Exchange Board of India SEBI have made registration of foreign investors much simpler. Previously, foreign investors registered with SEBI, but the new rules allow designated depository participants like NSDL and CDSL to accept all applications for registration as FPIs. Industry watchers say that the NSDL database may not reflect new registrations accurately until all existing FIIs are registered as FPIs. Indian equity markets have few restrictions on capital flows, but do limit foreign ownership stakes. FIIs and sub-accounts can own up to 10 percent and 5 percent respectively of the paid-up equity capital of any Indian company. All investor classes are permitted to sell short, except for NRIs. Investors must, however, maintain a minimum margin requirement. In Junethe RBI allowed FPIs to access the currency futures or exchange traded currency options market to hedge onshore currency risks in India, a move that was touted as a significant initiative in attracting Dollar inflows into the country. According to RBI data, the participation of FPIs in exchange traded currency derivatives has remained muted. Participation of FPIs in OTC currency derivatives has also remained quite low. Yet, the persistence of capital controls in the onshore market has led to the development of an offshore Rupee market called Non Deliverable Forward NDFparticularly in Singapore, Dubai, London, and New York. The RBI has taken a number of steps in the recent past to bring these offshore activities onshore, in order to deepen the domestic markets, enhance downstream benefits, and generally obviate the need for an NDF market. Foreign firms and persons are prohibited from trading in commodities. SEBI allows foreign brokers to work on behalf of registered FIIs, but these FIIs can also bypass brokers and deal directly with companies in open offers. FII bank deposits are fully convertible, and their capital, capital gains, dividends, interest income, and any compensation from the sale of rights offerings post tax, may be repatriated without prior approval. NRIs are subject to separate investment limitations. They can repatriate dividends, rents, and interest earned in India, and specially designated NRI bank deposits are fully convertible. Foreign venture capital investors FVCIs must register with SEBI to invest in Indian firms. They can also set up domestic asset management companies to manage funds. All such investments are allowed under the automatic route, subject to SEBI and RBI regulations, and to FDI policy. FVCIs can invest in many sectors including software business, information technology, pharmaceuticals and drugs, biotechnology, nanotechnology, biofuels, agriculture, and infrastructure. The company must be profitable for at least five years preceding the issuance, declaring dividends of no less than 10 percent each year and maintaining a pre-issue debt-equity ratio of no more than Standard Chartered Bank, a British bank which was the first foreign entity to list in India in Juneremains the only foreign firm to have issued IDRs. An ECB can raise a maximum of USD million in a financial year, unless it is in the hotel, hospital, software, or miscellaneous services sectors. NGOs engaged in micro-finance activities and Micro Finance Institutions can raise ECB up to USD 10 million in a financial year, and must hedge percent of their currency risk exposure. Non-bank Finance Company — Infrastructure Finance Companies NBFC-IFCs can raise ECB up to 75 percent of their owned funds india must hedge 75 percent of their currency risk exposure. The all-in cost ceilings for ECBs with an average maturity period of three-to-five years is capped at basis investment over the six-month LIBOR, and points for loans maturing after five years. Indian companies borrowed close to USD billion in foreign currency through ECBs and USD million through foreign currency convertible bonds FCCBs in Takeover regulations require disclosure upon acquisition of shares exceeding 5 percent of total capitalization. SEBI regulations require that any acquisition of 15 percent or more of the voting rights in a listed company must trigger a public offer. The public offer made by the acquiring entity i. Since Octoberan owner holding between 55 percent and 75 percent of voting rights can acquire additional voting rights of up to 5 percent without making a public offer i. RBI and FIPB clearances are required to assume a controlling stake in an Indian company. Cross shareholding and stable shareholding are not prevalent in the Indian market. Twenty-seven public sector banks PSB dominate the Indian banking market, the largest of which is the State Bank of India SBI. PSBs accounted for percent of aggregate deposits and percent of gross bank credit at the end of December PSBs are not technically subject to any excess regulations over commercial banks, neither in terms of lending practice nor deposits. They do, however, have their CEOs, upper management, and a number of their board of directors appointed by the government, meaning that the government can become quite influential in credit decisions. The Non-Performing Assets NPAs of the banks stood at USD 49 billion as of December due to sluggish growth. PSBs accounted for over 90 percent of total NPAs. The RBI has taken a number of steps to encourage recovery of NPAs, including mandatory board-approved loan recovery policies, establishment of effective mechanisms for information sharing regarding loan sanctions, and the establishment of legal mechanisms. As of Aprilmillion bank accounts have been opened under the initiative, which aims to provide a bank account to every un-banked Indian. It is likely the number of transactions will rise once the government expands its initiative for providing subsidies and benefits through direct bank transfers. Takeover regulation in India applies equally to domestic and foreign companies. The regulations do not recognize, however, any distinct category of hostile takeovers. RBI and FIPB clearances are required to acquire a controlling stake in Indian companies. Takeover regulations require disclosure on acquisition of shares exceeding 5 percent of total capitalization. Under the creeping acquisition limit, the acquirer holding 25 percent or more voting rights in the target company can acquire additional shares or voting rights up to 5 percent of the total voting rights in any financial year, up to a maximum permissible non-public shareholding limit of 75 percent generally. Acquisition of control over the target company, brokers of shares or voting rights held by the acquirer, will trigger a mandatory open offer. In India, the government owns or controls interests in key sectors with significant economic impact, including infrastructure, oil, gas, mining, and manufacturing. Over the decades, the Indian government has taken a number of steps to improve the performance of Central Public Sector Enterprises CPSEsincluding improvements to corporate governance. Reforms carried out in the s focused on liberalization and deregulation of most sectors and disinvestment of government shares. These and other steps to strengthen CPSE boards and india transparency evolved into a more comprehensive governance approach, culminating in the Guidelines on Corporate Governance of State-Owned Enterprises issued in investment their mandatory implementation from Governance reforms gained prominence for several reasons: the important role that CPSEs continue to play in the Indian economy; increased pressure on CPSEs to improve their competitiveness as a result of exposure to competition and hard budget constraints; new listings of CPSEs on capital markets. The Organization for the Economic Cooperation and Development OECD Guidelines on Corporate Governance of State-Owned Enterprises SOEs give concrete advice to countries on how to manage more effectively their india as company owners, thus helping to make state-owned enterprises more competitive, efficient and transparent. Adopted in as an internationally-agreed standard on how governments should exercise ownership of SOEs, the guidelines underwent review and revision in to take into account developments since their adoption and the experiences of the growing number of countries that have taken steps to implement their recommendations. India does not have a sovereign wealth fund. Looking to attract larger inflows from sovereign wealth funds and foreign pension funds, government and financial sector regulators have renewed their efforts to make Indian markets, especially government bonds, much more appealing to such investors. The policymakers view the overseas investments by sovereign wealth funds, multilateral agencies, endowment funds, pension funds, insurers, and foreign central banks as much more stable in nature, as compared to institutional investors and hedge funds. These and other reforms, he noted, have increased investor confidence in the country. Section requires publicly-held companies to spend 2 percent of annual domestic profits on CSR-related activities. The directors of companies that fail to report are held personally accountable under the law and can face fines or imprisonment. According to a recent joint handbook published by the Confederation of Indian Industries CII and Price Waterhouse Coopers on Corporate Social Responsibility in India, the industry has responded positively to CSR reform measures. The combination of regulatory and social pressures has led companies to pursue their CSR activities more systematically. The same handbook states that the Indian Institute of Corporate Affairs under the Ministry of Corporate Affairs estimates that a minimum of 6,000 Indian companies will be required to undertake CSR projects in compliance with the Companies Act. Many will be undertaking these initiatives for the first time. By requiring companies with a minimum net profit of USD 1 million to invest in CSR, the Companies Act is likely to bring many small and medium enterprises SME into the CSR fold. The lower threshold could usher in a fresh set of challenges as companies must become compliant with a diverse set of requirements. There have been no significant incidents involving political violence since mid However, outbursts of violence related to insurgent movements continue in Jammu and Kashmir and some northeastern states. Travelers to India are invited to visit the U. India is a signatory to the United Nations Conventions against Corruption and a member of the G20 Working Group against Corruption. The government has yet to implement the law, however, and as yet, no ombudsmen have been appointed. In Februarythe government enacted the Whistleblower Act, intended to protect anti-corruption activists, but as yet unimplemented. Businesses consistently cite corruption as a significant obstacle to FDI in India and identify government procurement as a process particularly vulnerable to corruption. The Companies Act,established rules related to corruption in the private sector by mandating mechanisms for the protection of whistle blowers, industry codes of conduct, and the appointment of independent directors to company boards. As yet, the government has established no monitoring mechanism, and it is unclear the extent to which these protections have been instituted. No legislation focuses particularly on the protection of NGOs working on corruption issues, though the Whistleblowers Protection Act,may afford some protection once it has been fully implemented. UN Anticorruption Convention, OECD Convention on Combatting Bribery India is a signatory to the United Nations Conventions against Corruption and is a member of the G20 Working Group against Corruption India is not party to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. Zak Political Officer U. Of these, 72 agreements are currently in force. In early local media reported that Coal India lost in international arbitration against an Australian firm. The Australian firm reportedly won its case based on more favorable treaty language from a third country investment treaty, leading the India of India to temporarily suspend all BIT negotiations until it had drafted a new model agreement. The Government of India circulated a new model BIT in April for two weeks of public comment. Foreign investors will not have access to bilateral investment treaties, if the contracts they have entered into with local investors or the government provide exclusively for legal recourse in India. InIndia concluded a Comprehensive Economic Cooperation Agreement CEPA with ASEAN and a free trade agreement FTA in goods, services, and investment with South Korea. In FebruaryIndia signed CEPAs with Japan and Malaysia. FTA negotiations with the EU and Canada are still under way, and India is negotiating a CEPA with Thailand. In Februarythe United States and India held technical discussions on a BIT. The Overseas Private Investment Corporation OPICa U. SinceOPIC has invested nearly USD billion in projects in India. OPIC is a key member of the U. In fiscal yearOPIC committed over USD 84 million to seven new projects in India, including investments in solar energy and loans to microfinance and SME lenders. Although there are more than 20 million unionized workers in India, unions represent less than 5 percent of the total work force. Most of these unions are linked to political parties. According to provisional figures from the Ministry of Labor and Employment MOLEover million workdays were lost to strikes and lockouts inas opposed to 2 million workdays lost in Labor unrest occurs throughout India, though the reasons and affected sectors vary widely. Some labor problems are the result of workplace disagreements over pay, working conditions, and union representation. South Indian states count as the most industrialized in India, and due to strong labor representation, Kerala stands out for most frequent strikes. Tamil Nadu and Karnataka follow, and the states of Gujarat and Andhra Pradesh also experience similar strikes and lockouts, according to government statistics. Nationally, the banking sector faces the most labor unrest. The rules governing the payment of wages and salaries are set forth in the Payment of Wages Act,and the Minimum Wages Act, Industrial wages vary by state, ranging from about USD per day for unskilled laborers to over USD per month for skilled production workers. Retrenchment, closure, and layoffs are governed by the Industrial Disputes Act of1947, which requires prior government permission to lay off workers or close businesses employing more than people. Foreign banks also require RBI approval to close branches. Permission is generally difficult to obtain, which has resulted in the increasing use of contract workers i. Private firms successfully downsize through voluntary retirement schemes. The BJP-led government that took office in May promised to reform labor laws and ease conditions for doing business in India. To date, much of the movement on labor laws has india place at the state level, particularly in Rajasthan, where the government has passed major amendments to allow for quicker hiring, firing, laying off, and shutting down. There are no reliable statistics for the number of unemployed in India due to the informal nature of most employment. The Government of India nonetheless acknowledges a shortage of skilled labor in high-growth sectors of the economy, including information technology and manufacturing. The current government has established a Ministry of Skill Development, has embarked on a national program to increase skilled labor. The government established several foreign trade zone schemes to encourage export-oriented production. These include Special Economic Zones SEZExport Processing Zones EPZSoftware Technology Parks STPand Export Oriented Units EOU. The newest category is the National Industrial and Manufacturing Zones NIMZof which 14 are being established across India. They also receive exemptions from industrial licensing requirements, and they enjoy tax holidays and other tax breaks. Export Processing Zones EPZs are industrial parks with incentives for foreign investors in export-oriented businesses. STPs are special zones with similar incentives for software exports. Export Oriented Units EOUs are industrial companies established anywhere in India that export their entire production and are granted the following: duty-free import of intermediate goods; income tax holidays; exemption from excise tax on capital goods, components, and raw materials; and a waiver on sales taxes. As part of its new industrial policy, the government has now begun the establishment of NIMZs. Fourteen NIMZs have been approved to date, of which eight are planned on the Delhi-Mumbai Industrial Corridor route. NIMZs have been envisioned as green-field integrated industrial townships with a minimum area of hectares and managed by a special purpose vehicle, headed by a government official. Publicly available information suggests that foreign and domestic companies will be able to seek all state and central government authorizations for operating with NIMZs via single window Foreign Direct Investment and Foreign Portfolio Investment Statistics Table 2: Key Macroeconomic Data, U. Source: Department of Industrial Policy and Promotion, Government of India Scott Schlossberg Economic Officer U. External links to other Internet sites should not be construed as an endorsement of the views or privacy policies contained therein. Note: documents in Portable Document Format PDF require Adobe Acrobat Reader or higher to view, download Adobe Acrobat Reader DOS Seal U. Department of State Diplomacy in Action Menu Secretary Kerry Remarks Travel Photos Biography About Mission Statement QDDR Organization Chart Budget Department of State by State Rules and Info Collection Partner With State Senior Officials Alphabetical List of Bureaus and Offices Brokers Groups Biographies Plans, Performance, Budgets Agency Financial Reports Open Government Initiative No FEAR Act Inspector General Hotline U. Embassies and Other Posts U. Business Chamber and sources within the government have reported that the Inter-Ministerial Committee has been meeting informally and on an ad-hoc basis as they receive reports from business chambers and affected companies of stalled projects Industrial Promotion Banking: Aggregate foreign investment from all sources in all private banks is capped at 74 percent. Please see Appendix 1 for a complete table of limits and procedures by sector Privatization Program The Government of India has not generally privatized its assets to the extent of allowing changes in management. In the budget, the government has set a target of USD billion INR billion of earnings through disinvestment; if achieved, this would be an historic high Screening of FDI Foreign Direct Investment FDI screening is undertaken by the Foreign Investment Promotion Board FIPBa Government of India entity that purportedly provides single window clearance for FDI proposals. The Minister of Finance approves FIPB decisions on investments up to USD million, while larger investments require approval from the Cabinet Committee on Economic Affairs CCEA Competition Law The Competition Commission of India CCI is a statutory body responsible for enforcing the Competition Act of The CCI, first established inbegan functioning in May The Act is in consonance with international standards, prohibiting anti-competitive agreements and abuse of dominant position by enterprises. Government Info Archive The Office of Website Management, Bureau of Public Affairs, manages this site as a portal for information from the U.
Best Online Brokerage for beginners in India. Stock market basics for Beginners
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A deletion discussion is about the article in question itself.
Salman Rushdie On George Stroumboulopoulos Tonight: INTERVIEW.
The Student Life Center also takes people out on excursions around the island.
Not entirely but like, 10 centimeters from the bottom of the wrist towards my elbow would get really stiff, the wrist gets hard to rotate.