Moving further with liberalisation of the foreign direct investment (FDI) regime, the government on Friday allowed overseas investment in bee-keeping, share-pledging for raising external debt and notified the revised FDI limit on FM radio at 26 per cent against the earlier 20 per cent. Similarly, conditions for FDI in respect of construction of old-age homes and educational institutions have been eased. These will not be subject to minimum and built-up area, capitalisation and lock-in period norms as applicable for the construction activities, according to an official statement issued here.
The hike in FDI cap in FM radio from 20 to 26 per cent, as approved by the Cabinet in July, has been notified. For giving a boost to bio-technology, pharmaceutical and life sciences, research and development in these sectors would be covered under the ‘industrial parks' scheme, where 100 per cent FDI is permitted under the automatic route.
Widening options for raising overseas resources, the policy has been amended to provide for pledge of shares of an Indian company which has raised ECBs, the statement said. The policy provides for opening and maintaining, without RBI approval, non-interest bearing rupee escrow accounts by non-residents towards payment of share purchase consideration. This has been done to facilitate FDI, it said. Procedure for conversion of imported capital goods and machinery and pre-operative expenses into equity has also been made easier. About opening honey bee-keeping to FDI, it said the liberalisation will bring in international best practices to upgrade the product. The measure will help food firms, engaged in honey-processing.
India received FDI inflows of $14.54 billion during April-July this fiscal, showing a jump of 92 per cent despite global economic uncertainties.
To attract foreign investment in the agriculture sector, the government today allowed 100 per cent FDI in beekeeping, also known as ‘apiculture'
“FDI has been allowed up to 100 per cent under the automatic route in apiculture under controlled conditions,” according to the revised Consolidated FDI Policy of 2011, released by the Department of Industrial Policy and Promotion (DIPP).
The DIPP has imposed certain conditions to companies keen on taking the 100 per cent FDI route in beekeeping.
Companies can undertake “production of honey by beekeeping, except in forest/wild, in designated spaces with control of temperatures and climatic factors like humidity and artificial feeding during lean seasons,” the policy paper said.
The government is bringing more farm areas under the 100 per cent FDI route to encourage investment in the sector.
It has already permitted 100 per cent FDI in agricultural areas such as plantation, horticulture, seeds and cultivation of vegetables and mushrooms.