Downstream Investment rules limit indirect foreign investment and require entry route, sectoral, pricing and reporting compliance.
Regulation 14 defines Downstream Investment, Indirect Foreign Investment and Total Foreign Investment, prescribes that downstream investments be subject to entry route, sectoral caps, pricing and other conditions, and requires funds for downstream investment to be from abroad or internal accruals. First-level investing companies remain responsible for compliance across subsequent layers, must obtain annual auditor certification and disclose compliance in directors' reports, and specified calculation rules and exclusions apply to determine total foreign investment.
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