FDI Policy 2014 — no major changes expected, none provided

The Consolidated FDI Policy (Circular 1 of 2014) was released by the Department of Industrial Policy and Promotion (DIPP) and the Ministry of Commerce and Industry on 17 April 2013, setting out the consolidated foreign direct investment (FDI) policy of India that comes into force with immediate effect. The new policy supersedes the Consolidated FDI Policy (Circular 1 of 2013) issued by DIPP on 6 April 2013.

As was the case with the old policy, the new policy mainly serves to: (i) consolidate various press releases issued by DIPP in the intervening period between the old policy and the new policy; and (ii) provide clarifications to align the new policy with existing laws and regulations.

Unfortunately, there are some gaps in the consolidation process such as non-inclusion of FDI norms in limited liability partnerships (notified on 13 March 2014), continued references to the Companies Act 1956 throughout the new policy despite substantial provisions of the Companies Act 2013 coming into effect from 1 April 2014 and continued reference to ‘venture capital funds’ instead of ‘alternate investment funds’…

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