The Government of India has the stated policy to provide Overseas Citizens of India (OCIs)/ Persons of Indian Origin (PIOs) parity with Non Resident Indians (NRIs). NRIs can make investment under schedules 1, 3 and 4 of FEMA 20/2000 issued by the Reserve Bank of India. Under Schedule 4 of FEMA, NRI investments are made on non-repatriation basis though it has not been provided that these are domestic investments. As per the FDI policy, definition of NRIs includes PIOs, and OCIs are not specifically mentioned.

Facility of investment on non-repatriable basis under Schedule 4 of FEMA 20/2000 was introduced primarily with the intention of providing NRIs an investment option for utilization of their domestic resources, which were not freely repatriable. The scheme was intended to provide NRIs an incentive to bring funds into India without repatriation rights, at a time when foreign exchange reserves were limited and capital inflows were modest. The provision should continue to incentivise investments by NRIs, including OCIs and PIOs, resulting in increased investments in the country. Since the investment made under Schedule 4 are on non-repatriable basis, it needs to be clearly provided that such investments, for the purposes of FDI policy, are domestic investments. This will enable investments by NRIs, OCI cardholders and PIO cardholders under Schedule 4 on non-repatriation basis, across sectors without being subjected to any of the conditions associated to foreign investment.

STEPS OF A VISIONARY
The Prime Minister launched ‘Make in India’ on 25 September 2014 to provide a boost to manufacturing sector in the country. Subsequently, Government embarked upon a number of initiatives on ease of doing business

90%
It is not surprising that more than 90% of the FDI received in the country comes under automatic route

WHAT IT IS
On FDI policy, measures taken by the Government are historic and far reaching. To begin with, the Government first reviewed the FDI policy in defence and railways sectors. Entire range of rail infrastructure was opened to 100% FDI under automatic route, and in defence, sectoral cap was raised to 49%

The Government of India has the stated policy to provide Overseas Citizens of India (OCIs)/ Persons of Indian Origin (PIOs) parity with Non Resident Indians (NRIs)