The government has further liberalized the FDI policy in 2016. This may give a boost to inflow of FDI. Ease of doing business, however, has not improved much as expected this year. Here are some noteworthy developments:
FDI Policy Reforms
- To further supplement domestic capital, technology and skills, for accelerated economic growth, Department of Industrial Policy and Promotion (DIPP) announced FDI policy reforms on 20th June, 2016. The policy amendments became effective from the date of release of the press note i.e. 24th June, 2016.
- The reforms inter-alia include FDI beyond 49% in Defence under approval route and 100% FDI for e-commerce in Food Products manufactured/ produced in India under approval route.
- Government vide Press Note 6 (2016) dated 25.10.2016 reviewed FDI policy on Other Financial Services and NBFCs.
- Foreign Investment in financial services activities regulated by financial sector regulators will be 100% under the automatic route.
- In financial services, which are not regulated by any financial sector regulator or where only part of the financial service activity is regulated or where there is doubt regarding regulatory oversight, foreign investment upto 100% will be allowed under the government approval route
Reforms in Intellectual Property Regime
In May, 2016, Government for the first time adopted a comprehensive National Intellectual Property Rights (IPR) policy to lay future roadmap for intellectual property. Here are some important features:
- his aims to improve Indian intellectual property ecosystem, hopes to create an innovation movement in the country and aspires towards “Creative India; Innovative India” “रचनात्मकभारत; अभिनव भारत”.
- Objective of this policy is to increase IPR awareness; stimulate generation of IPRs; have strong and effective IPR laws; modernize and strengthen service-oriented IPR administration; get value for IPRs through commercialization; strengthen enforcement and adjudicatory mechanisms for combating IPR infringements; and to strengthen and expand human resources, institutions and capacities for teaching, training, research and skill building in IPRs.
- Subsequent to the approval of this policy, a Cell for Intellectual Property Rights Promotion and Management (CIPAM) has been created as a professional body which will be working under the aegis of DIPP for addressing the 7 identified objectives of the Policy.
- MOU in the field of Intellectual Property signed with U.K, Singapore and E.U
- India-USA Workshop on Protection of Trade Secrets organized by CIPAM.
- Trademarks filing increased by around 10% and Trademark examination increased by around 250% during FY16 till Nov vis-à-vis FY15.
- Trademark pendency has come down to 3 months and to be 1 month by March 2017
- The total FDI inflows received during the last financial year (2015-16) at US$ 55.6 billion, an increase of 23% compared to the previous financial year (US$ 45.1 for 2014-15), has been the highest ever for any financial year till date.
- During the current financial year, The FDI inflows during April-October, 2016-2017 stood at US$ 27.82 billion as compared to US$ 21.87 billion in April-October 2015-2016.
- Manufacturing constitute around 41.5% of the equity inflows while non-manufacturing around 58.5% (during April 2014 to Sept 2016)