Tag: Foreign Investment
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Measuring outputs v. outcomes: Did the restriction on foreign investment in local debt achieve the intended outcome?
[The following guest post is contributed by Anurag Dutt, Arpita Pattanaik and Bhargavi Zaveri, who are researchers at the Finance Research Group at the Indira Gandhi Institute of Development Research, Mumbai.] A good policymaking process requires significant regulatory capacity. Before the policy is enacted, the State must (a) identify a market failure and an appropriate…
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The Hubtown Case: Supreme Court on the FDI Policy
[The following guest post is contributed by Tanavi Mohanty, who is a corporate lawyer practising in Mumbai] The decision of the Bombay High Court in the summary suit of IDBI Trusteeship Services Limited (ITSL) v. Hubtown Limited (Hubtown), better known as the Hubtown case has received a lot of attention for being the Bombay High…
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Foreign Portfolio Investments in Unlisted Non-Convertible Debentures
[The following post is contributed by Amitabh Robin Singh, who is a corporate lawyer practising in Mumbai.] Last month, the Reserve Bank of India (“RBI“) allowed Foreign Portfolio Investors (“FPIs“) to invest in unlisted non-convertible debentures (“NCDs“). This has been done by way of an amendment to the Foreign Exchange Management (Transfer or Issue of Security…
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Foreign Investments in Category III Alternative Investment Funds
[The following guest post is contributed by Kemi Gupta, who is a 5th year B.A., LL.B (Hons.) student at NALSAR University of Law] In a matter of only a few years,[1] India’s alternative investment industry has grown to Rs. 20,700 crore in size,[2] and is yet claimed to be in its early stages. Alternative investment…
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Liberalization of RBI’s Policies
The Reserve Bank of India (RBI) last week issued a series of circulars liberalizing and streamlining its policies on various types of equity investments as well as on external commercial borrowings (ECBs). The key pronouncements are highlighted below: 1. Foreign Investment in “Other Financial Services” In the case of non-banking finance companies (NBFCs), foreign investment…
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An Update on the FDI Reforms
[The following guest post is contributed by Bhushan Shah and Neha Lakshman of Mansukhlal Hiralal & Company. The views expressed are personal.] After significant changes in the Foreign Direct Investment (FDI) policy in November 2015, the Union Government through Press Note No. 5 (2016 Series) issued on 24 June 2016[1] announced further important changes to…
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Easy-commerce?
[The following guest post is contributed by Arup Pereira, who is a Principal Associate at J. Sagar Associates, Mumbai] The Government’s foreign direct investment (“FDI”) policy on retail trading in India encourages foreign companies and Indian companies with foreign investment to “Make in India”. At present, FDI is not permitted in an Indian company engaging…
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RBI Permits Deferment of Consideration and Escrow Mechanism Under Automatic Route
[The following post is contributed by Abhishek Dubey who is a Managing Associate with BMR Legal, Delhi. The views expressed here are personal.] In continuation of its policy to rationalize the existing regime under the Foreign Exchange Management Act and to promote the ease of doing business, the Reserve Bank of India (RBI) has amended…
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Some Ambiguities in the Rules on Downstream Investments
[The following guest post is contributed by Ajay G. Prasad, who is a Senior Associate with Kochhar & Co, Bangalore. Views expressed in this post are personal and do not reflect the views of the firm.] Exchange control rules on downstream investment form an important aspect to consider in M&A transactions. As per the foreign…
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A Move Towards “Pool in India”; However, Room for More Reforms Exists!
[The following post is contributed by Yashesh Ashar, who is a tax and regulatory consultant. Views expressed are personal.] The Finance Bill, 2016 has given in to the much sought-after demand of the domestic private equity (PE) industry by amending the provisions relating to the tax withholding obligations for the category I and category II…
