- The government clarified it had deliberately kept the defence and banking sectors out of the purview of composite foreign investment caps to avoid “fly-by-night operators” and “quick money” entering these sensitive sectors.
- The Cabinet Committee on Economic Affairs approved the long-pending demand of international investors of subsuming all types of foreign investments into a single sectoral limit, wherever they are applicable.
- At present, in the defence sector, foreign investment limit of 49 percent is allowed under the automatic route.
- For investment proposals above 49 percent, permission by the Cabinet Committee on Securities (CCS) on a case-to-case basis will be required.
- In private sector banking, the FPI limit is 49 per cent.
- The aggregate foreign investment in a private bank from all sources will be allowed up to a maximum of 74 percent of the paid up capital of the bank, within which there is sub-cap for FPIs.