odi English news | odi, Latest News & Live Updates in English | English News (Latest English News) at Lokmattimes.com

The existing legal framework under FEMA does not permit FDI by an overseas JV or WOS of an Indian party without the prior approval of RBI. Similarly, there are restrictions on Indian entities to undertake overseas direct investment (ODI) in a foreign entity which already has existing FDI investment structures in India.Official sources said that the changes would soon be be made in existing overseas direct investment (ODI) Regulations to ease the restrictions and put such investments (FDI and ODI) under the automatic route (without prior approval of RBI).The changes have become important in the backdrop on slowing of the Indian economy and resultant lack of investment by the corporate sector. The stringent view adopted by the RBI under the objective of preventing 'round tripping' of funds has impacted abilities of certain Indian companies which have made ODI outside India to attract FDI in India even for their group entities, even for legitimate and bona fide business purposes.A High Level Advisory Group (HLAG)-chaired by economist Surjit Bhalla, on how to increase India's exports, in its report has also suggested sweeping change in FDI regulations with a way to attract funds that go into building businesses in the country.Sources said that the Department for Promotion of Industry and Internal Trade (DPIIT) is also studying the report for finalising changes in the Press Note pertaining to FDI by JV of WOS of Indian party. Official sources said that though the changes would give free access to FDI by an Indian entity through its own JV or WOS, it would need to be established that such flow of funds is only for bonafide business interests and such funds are invested as FDI in India through proper banking channels.Accordingly, it is likely that investment by a foreign entity (in which ODI is being made) whose total value of existing FDI does not exceed 25 per cent of its consolidated net worth not be considered as 'round tripping' or in violation of ODI regulations.Net worth of overseas entity in this case should be at least $10 million. Moreover, any additional FDI may be allowed provided such funds are not directly or indirectly from India. The HLAC in its report has also recommended exemption to overseas listed companies i.e. companies which are listed overseas in Financial Action Task Force (FATF) jurisdictions (with market capitalisation of certain specified thresholds), should also be allowed to invest in India, irrespective of its shareholding being held by persons resident in India.ODIs include investments done outside India by an Indian by way of subscription to the memorandum of a foreign entity or purchase of existing shares of a foreign entity either by market purchase or private placement or through stock exchanges, signifying a long-term interest in the foreign entity.(Subhash Narayan can be contacted at subhash.n@.in)( With inputs from IANS )

OdiFOLLOW

Odi, Latest News

Ireland pacer Tim Murtagh announced his retirement from international cricket on Friday. ...

Chinaman bowler Kuldeep Yadav has hit a rough patch in recent times, especially since the last edition of the Indian Premier League, but former India batting coach Sanjay Bangar has come out in support of the spinner and said that it is important to ...

Pakistan have announced the 15-member squads for the upcoming three ODIs and as many T20Is in the ICC Women's Championship on Wednesday. ...

As India batsman, Suresh Raina celebrates his 33rd birthday today, wishes continue to pour in for the 'Southpaw'. ...

Former England batsman Marcus Trescothick has signed a two- year coaching deal with Somerset and will be part of the backroom staff as the club's assistant coach. ...

India spinner Harbhajan Singh on Monday said that the selection panel of the Board of Control for Cricket in India (BCCI) needs to be changed and urged the body's chief Sourav Ganguly to the needful in this regard. ...

Out-of-favour off-spinner Harbhajan Singh has requested BCCI President Sourav Ganguly to change the selection committee, stating "strong people" need to be in that panel. ...

In a bid to ease the flow of foreign funds into legitimate business activities, the government may soon ease restrictions on foreign direct investment (FDI) by joint ventures (JVs) or wholly-owned subsidiaries (WOS) of an Indian company without categ ...