Washington, D.C., Jan. 10, 2018: The US-India Strategic Partnership Forum (USISPF) today lauded the opening of Foreign Direct Investment (FDI) by the Government of India. On Wednesday The Union Cabinet allowed 100 percent FDI in single brand retail through the automatic route. The move will make it easier to do business in India.
The government also allowed foreign airlines to invest up to forty-nine percent in Air India, with the condition that the majority of ownership and control of Air India would remain under Indian nationals. The amendment that will allow 100 percent FDI under the automatic route will affect single brand retail trading and construction development. In addition, Foreign Institutional Investors (FIIs) and Foreign Portfolio Investors (FPIs) have been allowed to invest in power exchanges through the primary market. Furthermore, the definition of 'medical devices' has been amended in the FDI policy to broaden the scope of items that can attract 100 percent FDI through the automatic route.
USISPF lauds this significant move by the Indian government, which has the potential to alleviate major trade hurdles that U.S. companies have faced in the past. USISPF President Mukesh Aghi alluded to the significance of the change for USISPF member companies, saying, “India continues to make economic reforms and gets rewarded with higher growth. We have seen progress in the Modi government over the past year with the recent GST reforms and introduction of the Bankruptcy and Insolvency Act. India will continue to see growth with economic reforms such as this one—it’s a virtuous cycle.”
John Chambers, Chairman of USISPF and Chairman Emeritus of Cisco, commented on the policy, saying “this amendment is a great move by the Modi government and it makes India much more attractive to foreign investors. I applaud the Prime Minister’s leadership in recent reforms and look forward to watching both foreign and Indian companies benefit from this significant leap forward.” Bold steps are necessary to make effective change in India, which holds vast potential with its size, entrepreneurial population, and significant English-speaking consumer base. Steps such as FDI reform will encourage foreign investors and allow India to realize its dream of becoming one of the world’s most powerful economies.
Formed in 2017 by U.S. business leaders, USISPF has carefully selected the most powerful and strategically positioned Board of Directors for U.S.-India related matters. These members serve as both prominent business leaders and global influencers with an ability to impact international relations and corporate affairs worldwide. Headquartered in Washington, D.C., USISPF has offices in New York, Silicon Valley, Mumbai, and New Delhi.