Press Note 1 of 2021 – Review of FDI policy on downstream investments by NRIs
March 22, 2021
The DPIIT has issued Press Note 1 of 2021 to clarify that investments by non-resident Indians (NRIs) on a non-repatriation basis (as stipulated in Schedule IV of the FEM (Non-Debt Instruments) Rules, 2019) are deemed to be domestic investments at par with investments made by residents. Accordingly, an investment made by an Indian entity which is owned and controlled by an NRI(s) on a non-repatriation basis will not be considered while calculating indirect foreign direct investment .
A new clause (c) under Para 1.2(ii) in Annexure IV of the Consolidated FDI policy, 2020 has been inserted to this effect. The said decision will come into force from the date of FEMA notification.
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