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The government of India is trying to tap the potential of NRI community by easing the investment norms against the conventional FDI norms. Liberalising the FDI norms for NRI investments can boost the capital inflows in defence and railways effectively.

The department of industrial policy and promotion (DIPP) has sought Cabinet approval for considering NRI non-repatriable funds as domestic investment instead of FDI. The government authorities are planning to ease the sectoral restrictions for NRIs to strengthen the defence, railways, medical devices and insurance.

So far NRIs are allowed to invest up to100% in Civil aviation sector against an FDI cap of 74% cap for scheduled air transport service and up to 49% for non-scheduled air carriers. This will ensure promotion in India’s ranking for ease of doing business from 142 of 189 countries; government is aiming to see India in the top 50 countries in upcoming years.

The inflows have been increased in past 9 months and the government also opened up railways infrastructure to 100% foreign funding and raised the FDI cap in defence to 49% from 26% earlier.

We have to wait and see how the Indian Diaspora responds to the wish and push by the government in recent times.

-Kannamsai