Government of India

Ministry of Commerce & Industry

Department of Industrial Policy & Promotion

(FC-I Section)

Press Note No.3 (2011 Series)

Subject: Review of the policy on Foreign Direct Investment in pharmaceuticals sectorinsertion of a new paragraph 6.2.25 to 'Circular 2 of 2011-Consolidated FDI Policy'

1.0 Present Position:

Foreign Direct Investment (FDI), up to 100%, under the automatic route, is permitted in the pharmaceuticals sector.

2.0 Revised Position:

The Government of India has reviewed the extant policy on FDI and decided as under:

(i) FDI, up to 100%, under the automatic route, would continue to be permitted for greenfield investments in the pharmaceuticals sector.

(ii) FDI, up to 100%, would be permitted for brownfield investments (i.e. investments in existing companies), in the pharmaceuticals sector, under the Government approval route.

3.0 Accordingly, the following amendment is made in 'Circular 2 of 2011- Consolidated FDJ Policy', dated 30.09.2011, issued by the Department ofIndustrial Policy & Promotion:

Insertion of a new paragraph 6.2.25:

A new paragraph (6.2.25) is inserted as below:

6.2.25	Pharmaceuticals
6.2.25.1	Greenfield	100%	Automatic
6.2.25.2	Existing companies	1100%	Government

4.0 The above decision will take immediate effect. It would be reviewed after a period of six months.

(Anjali Prasad)

Joint Secretary to the Government of India

D/o IPP File No.: 1/16//2010-FC-I dated: 8^th November, 2011

Copy forwarded to:

1. Press Information Officer, Press Information Bureau- for giving wide publicity to the above Press Note.

2. BE Section in the Department of Industrial Policy and Promotion- for uploading the Press Note on DJPP's website.

Foreign direct investment policy change: greenfield projects allowed automatic entry, existing companies require government approval. The amendment permits FDI up to 100% for greenfield pharmaceutical projects under the automatic route, and permits FDI up to 100% for investments in existing pharmaceutical companies under the government approval route; the change takes immediate effect and will be reviewed after six months.