Review of Foreign Direct Investment (FDI) Policy in Defence Sector

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....estment (FDI) Policy in Defence Sector 1. Present Position 5.2.6 Defence Sector/Activity % of Equity/ FDI Cap Entry Route 5.2.6.1 Defence Industry subject to Industrial license under the Industries (Development & Regulation) Act, 1951 and Manufacturing of small arms and ammunition under the Arms Act, 1959 100% Automatic up to 49% Government route beyond 49% wherever i....

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....o be self-sufficient in areas of product design and development. The investee/joint venture company along with manufacturing facility, should also have maintenance and life cycle support facility of the product being manufactured in India. 2. Revised Position The Government of India has reviewed the extant FDI policy in Defence sector and the policy will now be read as under: 5.2.6 Defenc....

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.... in case change in equity/shareholding pattern or transfer of stake by existing investor to new foreign investor for FDI up to 49%, within 30 days of such change. Proposals for raising FDI beyond 49% from such companies will require Government approval. iii. Licence applications will be considered by the Department for Promotion of Industry and Internal Trade, Ministry of Commerce & Indus....