FDI liberalization expands sectoral ownership caps and clarifies approval and compliance conditions for foreign investment.
Targeted FDI liberalisation revises sectoral ownership caps and approval conditions: aviation maintains 49% for scheduled carriers (no foreign airline participation) while permitting up to 74% for non scheduled/charter/cargo and ground handling (NRIs 100%); petroleum removes compulsory divestment and raises PSU refining equity to 49% with prior approval; commodity exchanges allow 26% FDI and 23% FII with 5% single investor cap; credit information companies permit 49% foreign investment with government and RBI clearance and 24% FII in listed CICs; titanium mining allows 100% FDI with value addition and tailings disposal safeguards; Press Note 2(2005) exclusions clarified for industrial parks and registered FIIs under PIS.

Net international investment position rises as capital inflows boost reserve assets and external investment liabilities.
The IIP as at end-June 2007 records an increased net international investment position due to substantial capital inflows, with reserve assets and direct investment abroad driving asset growth and portfolio, direct and other investments expanding liabilities; reserve assets exceeded external debt and the share of non-debt liabilities rose because of higher direct and portfolio investment inflows.