As per extant FDI policy, FDI, upto 100%, is permitted, under the automatic route for greenfield, and under the government approval route for brownfield pharmaceuticals sector. Further, FDI, upto 100%, under the automatic route, is permitted for manufacturing of medical devices/ equipments both for greenfield and brownfield investments.

 There is, at present, no proposal under consideration of the Government to review the extant FDI policy in the medical devices/ equipments.

 In order to protect the domestic pharmaceuticals sector, FDI policy provides that ‘Non-compete’ clause would not be allowed except in special circumstances with the approval of the Foreign Investment Promotion Board. In addition, Government may incorporate appropriate conditions for FDI in brownfield cases, at the time of granting approval. Further, with a view to incentivize investment in the manufacturing of medical devices, the sector has been placed under the automatic route.

 As per extant FDI policy, FDI, upto 100%, is permitted, under the automatic route for greenfield, and under the government approval route for brownfield pharmaceuticals sector.

 This information was given by the Minister of State (Independent Charge) in the Ministry of Commerce & Industry Smt. Nirmala Sitharaman in a written reply in Lok Sabha today.

FDI policy in pharmaceuticals permits automatic-route manufacturing investment and limits non-compete clauses subject to approval. FDI policy permits investment in pharmaceuticals via the automatic route for greenfield projects and via government approval for brownfield projects; the automatic route also covers manufacturing of medical devices and equipment for both greenfield and brownfield investments. The policy prohibits non-compete clauses except in special circumstances subject to Foreign Investment Promotion Board approval, and allows the Government to impose conditions on brownfield approvals.