Government introduces new SOP for FDI approvals: 12-week deadline and fully digital process
The Centre has introduced a new Standard Operating Procedure (SOP) for Foreign Direct Investment (FDI) proposals, aiming to accelerate inflows into priority sectors by capping processing time at 12 weeks. The fully digital process mandates the Department for Promotion of Industry & Internal Trade (DPIIT) to disseminate proposals to relevant ministries, RBI, MHA, and MEA within two days. These bodies must submit comments within eight weeks, with internal scrutiny completed within 12 weeks. Delays in responses will be treated as no objection. The SOP also clarifies that no prior approval is needed for increasing foreign equity up to Rs 5000 crore if the percentage of foreign/NRI equity remains unchanged.
Key Points
- A new SOP for FDI proposals aims to cap processing time at 12 weeks and implement a fully digital process.
- DPIIT will disseminate proposals to relevant ministries, RBI, MHA, and MEA within two days.
- Ministries and other bodies must provide comments within eight weeks, with a 12-week deadline for internal scrutiny.
- Delays in inter-ministerial responses will be considered as no objection.
- No prior approval is required for increasing foreign equity up to Rs 5000 crore if the percentage of foreign/NRI equity remains unchanged.
Exam Facts
- Policy: Standard Operating Procedure (SOP) for FDI
- Processing time cap: 12 weeks
- Key departments: DPIIT, RBI, MHA, MEA
- Foreign equity increase without prior approval: Up to Rs 5000 crore
- Last net FDI inflow: $4.62 billion (February)
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