Saturday, March 12, 2011

Government's updated FDi policy may relax FII investment cap.

The Department of Industrial Policy & Promotion has proposed to relax the investment cap for foreign institutional investors, but with conditions, reports CNBC-TV18's Rituparna Bhuyan. The proposal by the DIPP suggests hiking the FII investment limit up to the cap on Foreign Direct Investment. The total FII investment cap is 24% if it is done via an FDI scheme.

The scheme will be part of the updated FDI policy, which will be unveiled on March 31. The Department has said that a prior board and shareholder nod is a must for such an increase. It has also proposed equity shares against import of capital goods equipment to be FDI. Capital goods will include second-hand machines. Foreign direct investment into the investment company will also need the approval of the Foreign Investment Promotion Board.


Source: www.moneycontrol.com


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Maulik Doshi

DENIP Consultants Pvt Ltd.

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