Rajya Sabha

In accordance with the existing FDI policy, FDI up to 100 per cent is permitted under the automatic route in Floriculture, Horticulture, Development of seeds, Animal Husbandry, Pisciculture, Acquaculture and Cultivation of Vegetable and Mushrooms under controlled conditions and services related to Agro and allied sectors. FDI upto 100 per cent, with prior Government approval, is permitted in Tea plantation subject to the conditions of divestment of 26 per cent equity of the company in favour of an Indian partner/Indian public within a period of five years and with the prior approval of the State Government concerned in case of future land use change. FDI upto 100 per cent under the automatic route is also allowed in the Food Processing Industry and for infrastructure facilities like Cold storage, transportation etc. There is no proposal to further ease the FDI norms in agro processing and agro infrastructure.

This information was given by Shri Pawan Kumar Bansal, Minister of State for Finance in reply to a question raised by Shri Rajkumar Dhoot in Rajya Sabha today.

FDI automatic route in agro-processing permits full foreign investment; tea plantations require Indian equity divestment and state approval. The regulatory position confirms that FDI up to 100 per cent under the automatic route is permitted for specified agro and allied activities, and for the Food Processing Industry and related infrastructure; tea plantations are permitted FDI subject to prior government approval and a mandated divestment of 26 per cent equity to Indian interests within five years and state approval for future land use change.