NEW DELHI: The Central government has simplified the foreign or overseas investment regulations with the aim of enhancing the 'ease of doing business' sentiment.
By bringing greater clarity to both overseas direct investment and overseas portfolio investment, it has streamlined the current framework for overseas investment and brought it into line with contemporary business dynamics. This was accomplished by converting a number of offshore investment-related transactions that were previously approved to automatic, according to a statement from the Finance Ministry. The statement said, "There is a need for Indian corporates to be part of the global value chain, given the developing needs of businesses in India, in an increasingly interconnected global economy.
The Reserve Bank of India (RBI) and the government collaborated throughout a thorough exercise to streamline these rules. The draft Foreign Exchange Management - Overseas Investment - Rules and regulations were also put in the public domain for consultations.
These rules and regulations have replaced previous ones that dealt with foreign investments and the purchase and transfer of real estate outside of India, according to the statement.
"In view of the evolving requirements of businesses in India, in an increasingly integrated global market, there is a need for Indian corporates to be part of the global value chain," the statement added while explaining the rationale behind the move.
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