“The finance minister’s promise to undertake a comprehensive review of the foreign direct investment regime and align it with the country’s emerging priorities is a step in the right direction. Further, liberalization, coupled with a simpler reporting regime, would go a long way toward enhancing India’s attractiveness to foreign investors. It will also help increase inflows of funds into several untapped sectors and introduce competition among incumbent players. Also, the proposal to permit individual persons resident in India to invest in the Indian stock market through the portfolio scheme and an increase in investment limits will increase the buoyancy of the Indian stock market and will help in bringing back foreign fund flows into equities. While we will have to wait for the fine print, both measures are likely to add to FDI inflows into India”.
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