India is the 7^th largest and 2^nd most populous country in the world. With ambitious economic reforms aimed at deregulating the economy and stimulating foreign investment has helped India tremendously. India has become one of the most exciting emerging markets in the world with highly Skilled managerial and technical manpower that matches the best available in the world.  Private sector participation is encouraged and this helped India address privatization of Infrastructure, which was ‘unthinkable’ few years ago.

   Indian Government initiated liberalization and economic reforms programme in July 1991. Reforms in Industrial sectors in India are effectively implemented and the Industrial licensing has been abolished except in a small number of sectors where it has been retained on strategic considerations. And probably that too may go away in due course of time. These industrial policy reforms have substantially reduced the industrial licensing requirements, removed restrictions on expansion and facilitated easy access to foreign technology and foreign direct investment.

  Most important of all was the Foreign Direct Investment Policy by the Government of India. Foreign Direct Investment in India is allowed on automatic route in almost all sectors except for a few cases like proposals that require an industrial license and cases where foreign investment is more than 24% in the equity capital of units manufacturing items reserved for the small scale industries   or proposals in which the foreign collaborator has presence in India already in the form of join venture or a tie up with a local company   etc.

  Foreign Investment Promotion Board (FIPB) comes under the Department of Economic Affairs, Ministry of Finance and handles issues of foreign direct investment (FDI), which do not come under the automatic route.

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