Automatic Route and Sectoral limits - Foreign Direct Investment Concept, Interdisciplinary issues in Video Lecture | Interdisciplinary Issues in Indian Commerce - B Com

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you
hi everyone welcome to fusion law school
in today's lecture we will be discussing
the two routes through which foreign
direct investment can be made in India
the two routes are first the automatic
route second the approval or government
the automatic route is import those
sectors and levels of investment that
are less restricted on the other hand in
case of approval route government
agencies regulated and scrutinized
foreign investment while approving it
the classification of FDI under
automatic and approval routes our aim to
have monitoring over the investment
activities at the same time to avoid
wasteful procedural delays the trend in
FDI show that more and more investments
are coming through automatic route
recent data shows that around 90 percent
of FBI is coming under automatic route
now let's discuss these two routes in
little more detail
first we will discuss the automatic rule
the automatic route stands for less
restricted or more liberalized
regulation under the automatic route the
foreign investor or the Indian company
does not require any approval from the
Reserve Bank or the government of India
for the investment however they have to
inform the RBI about the amount of
investment within a stipulated time
period this requirement is also
applicable on the investment through
approval route
now we will discuss the approval route
under the approval route or the
government rule the foreign investor or
the Indian company should obtain prior
approval of certain governmental
agencies currently proposals for foreign
investment under the approval route as
laid down in the FDI policy are
considered by either Foreign Investment
Promotion Board that is FIP B or Cabinet
Committee on Economic Affairs that is CC
ei or
Cabinet Committee on security in certain
cases the Department of Economic Affairs
or Department of industrial policy and
promotion are also assisting these
approving agencies the FIP B considers
those investments up to rupees 5000
crores for approval above this limit
approval will be made by C CEO which
body or agency has to give the approval
for a specific FDI proposal depends upon
this sector and the nature of investment
specified under the consolidated policy
on FDI even though the government has
announced phasing out fi BB at moment
these agencies are responsible for
allowing the foreign direct investment
under the approval route with this we
would like to conclude this video
lecture I hope you now understand the
two routes through which FDI can come in
India as always if you have any doubts
or queries about this lecture please
reach out to us on doubts at fusion
Rajesh cool calm in the end thanks for
watching this video lecture
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channel in foreign direct investments or
more commonly known as the nih it has no
controversial