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ParityPortal | October 21, 2017

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Indian Gov clears way for 100% FDI in telecoms

Indian Gov clears way for 100% FDI in telecoms
Ravi Mandalia

The Government of India, in a major reforms push, has waved a green flag to 100 per cent foreign direct investment (FDI) in the telecom sector thereby fulfilling a long terms request of otherwise cash starved industry.

Before this approval, FDI limit stood at 74 per cent of which 49 per cent was allowed for through automatic routes whereas the rest of the 25 per cent required an approval from Foreign Investment Promotion Board (FIPB).

Commerce and Industry Minister Anand Sharma said, “Basic and Cellular Services (fix phone and mobile services), existing has been 74 per cent and up to 49 per cent automatic route and 74 per cent though FIPB route. Now there is raising of cap from 74 to 100 per cent in basic and cellular services. Up to 49 per cent remains under automatic route and 49-100 per cent through FIPB route.”


The primary motive behind the decision to increase FDI in telecoms is to help the industry get fresh funds and reduce the financial burden. However there is more in store for foreign partners as they can now have complete ownership of the business.

PwC India’s ED – Tax and Regulatory services, Goldie Dhama said, “Foreign investors will no longer need to partner with Indian investors in order to comply with regulatory requirements.”