The Department for Promotion of Industry and Internal Trade (DPIIT) has on 28 October 2020 released the “Consolidated Foreign Direct Investment Policy 2020” (FDI Policy 2020) that has come into effect from 15 October 2020.
The FDI Policy 2020 subsumes and supersedes all previous Press Notes/ Press Releases/Clarifications issued prior to 15 October 2020, including Press Note No. 3 of 2020 which deals with restrictions on investments from countries sharing land border with India to prevent opportunistic takeovers of entities whose operations and finances may have suffered during the lockdowns and due to the COVID-19 pandemic in general (competent authority for approval would be as notified by the DPIIT). The FDI Policy 2020 primarily seeks to consolidate under one document the various amendments in foreign investment laws since the release of the last consolidated FDI policy in 2017.
DPIIT also has endeavoured to ensure that the FDI Policy 2020 keeps pace and is harmonious with laws dealing in similar subject matters, especially if we note the changes made to the definitions thereunder. It should however be noted that in case of any conflict between the FDI Policy 2020 and the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, the latter would prevail.
The FDI Policy 2020 can be accessed through the following link:
https://dipp.gov.in/sites/default/files/FDI-PolicyCircular-2020-28October2020.pdf