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A foreign company can start its business operations in India by incorporating a company under the Companies Act, 2013 through either a Joint Venture (JV) or forming a Wholly Owned Subsidiary (WOS). Foreign equity in such Indian companies can be up to 100%, subject to Sectoral equity caps under the FDI policy. The Sectoral caps as per the FDI policy are as follows:

Chart for Sectoral Caps for FDI in INDIA showing FDI Limit, Foreign Investment Cap (%) and Entry Route

Sector FDI Limit Entry Route & Remarks
Agriculture & Animal Husbandry

  • Floriculture, Horticulture, Apiculture and Cultivation of Vegetables & Mushrooms under controlled conditions
  • Development and Production of seeds and planting material
  • Animal Husbandry(including breeding of dogs), Pisciculture, Aquaculture
  • Services related to agro and allied sectors
100% Automatic
Plantation Sector

  • Tea sector including tea plantations
  • Coffee plantations
  • Rubber plantations
  • Cardamom plantations
  • Palm oil tree plantations
  • Olive oil tree plantations
100% Automatic

Mining and Exploration of metal and non-metal ores including diamond, gold, silver and precious ores but excluding titanium bearing minerals and its ores

100% Automatic
Mining (Coal & Lignite) 100% Automatic

Mining and mineral separation of titanium bearing minerals and ores, its value addition and integrated activities

100% Government
Petroleum & Natural Gas

Exploration activities of oil and natural gas fields, infrastructure related to marketing of petroleum products and natural gas, marketing of natural gas and petroleum products etc

100% Automatic
Petroleum & Natural Gas

Petroleum refining by the Public Sector Undertakings (PSU), without any disinvestment or dilution of domestic equity in the existing PSUs.

49% Automatic
Defence Manufacturing 100% Automatic up to 49% Above 49% under Government route in cases resulting in access to modern technology in the country

  • Teleports(setting up of up-linking HUBs/Teleports)
  • Direct to Home (DTH)
  • Cable Networks (Multi System operators (MSOs) operating at National or State or District level and undertaking upgradation of networks towards digitalization and addressability
  • Mobile TV
  • Head end-in-the Sky Broadcasting Service(HITS)
100% Automatic
Cable Networks (Other MSOs not undertaking up gradation of networks towards digitalization and addressability and Local Cable Operators (LCOs))
100% Automatic
Broadcasting Content Services

  • Terrestrial Broadcasting FM(FM Radio)
  • Up-linking of ‘News & Current Affairs’ TV Channels
49% Government
Up-linking of Non-‘News & Current Affairs’ TV Channels/ Down-linking of TV Channels 100% Automatic
Print Media

  • Publishing of newspaper and periodicals dealing with news and current affairs
  • Publication of Indian editions of foreign magazines dealing with news and current affairs
26% Government
Publishing/printing of scientific and technical magazines/specialty journals/ periodicals, subject to compliance with the legal framework as applicable and guidelines issued in this regard from time to time by Ministry of Information and Broadcasting. 100% Government
Publication of facsimile edition of foreign newspapers 100% Government
Civil Aviation – Airports
Green Field Projects & Existing Projects
100% Automatic
Civil Aviation – Air Transport Services

  • Scheduled Air Transport Service/ Domestic Scheduled Passenger Airline
  • Regional Air Transport Service
100% Automatic up to 49%
Above 49% under Government route
100% Automatic for NRIs
Civil Aviation

  • Non-Scheduled Air Transport Service
  • Helicopter services/seaplane services requiring DGCA approval
  • Ground Handling Services subject to sectoral regulations and security clearance
  • Maintenance and Repair organizations; flying training institutes; and technical training institutions
100% Automatic
Construction Development: Townships, Housing, Built-up Infrastructure 100% Automatic
Industrial Parks 100% Automatic
Satellites- establishment and operation, subject to the sectoral guidelines of Department of Space/ISRO 100% Government
Private Security Agencies 74% Automatic up to 49%
Above 49% & up to 74% under Government route
Telecom Services 100% Automatic up to 49%
Above 49% under Government route
Cash & Carry Wholesale Trading 100% Automatic
E-commerce activities (e-commerce entities would engage only in Business to Business (B2B) e-commerce and not in Business to Consumer (B2C) e-commerce.) 100% Automatic
Single Brand retail trading

Local sourcing norms will be relaxed up to three years and a relaxed sourcing regime for another five years for entities undertaking Single Brand Retail Trading of products having ‘state-of-art’ and ‘cutting edge’ technology.

100% Automatic up to 49%
Above 49% under Government route
Multi Brand Retail Trading 51% Government
Duty Free Shops 100% Automatic
Railway Infrastructure

  • Construction, operation and maintenance of the following
  • Suburban corridor projects through PPP
  • High speed train projects
  • Dedicated freight lines
  • Rolling stock including train sets, and locomotives/coaches manufacturing and maintenance facilities
  • Railway Electrification
  • Signaling systems
  • Freight terminals
  • Passenger terminals
  • Infrastructure in industrial park pertaining to railway line/sidings including electrified railway lines and connectivities to main railway line
  • Mass Rapid Transport Systems.
100% Automatic
Asset Reconstruction Companies 100% Automatic
Banking- Private Sector 74% Automatic up to 49%
Above 49% & up to 74% under Government route
Banking- Public Sector 20% Government
Credit Information Companies (CIC) 100% Automatic
Infrastructure Company in the Securities Market 49% Automatic

  • Insurance Company
  • Insurance Brokers
  • Third Party Administrators
  • Surveyors and Loss Assessors
  • Other Insurance Intermediaries
49% Automatic
Pension Sector 49% Automatic
Power Exchanges 49% Automatic
White Label ATM Operations 100% Automatic
Non-Banking Finance Companies (NBFC) 100% Automatic
Pharmaceuticals(Green Field) 100% Automatic
Pharmaceuticals(Brown Field) 100% Automatic up to 74%
Above 74% under
Government route
Food products manufactured or produced in India

Trading, including through e-commerce, in respect of food products manufactured or produced in India.

100% Government

 Prohibited Sectors for FDI In India

 FDI is prohibited in the following sectors

  • Lottery Business including Government/private lottery, online lotteries, etc.
  • Gambling and Betting including casinos etc.
  • Chit funds
  • Nidhi company
  • Trading in Transferable Development Rights (TDRs)
  • Real Estate Business or Construction of Farm Houses (Real estate business does not include development of townships, construction of residential /commercial premises, roads or bridges )
  • Manufacturing of cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes
  • Activities/sectors not open to private sector investment e.g. Atomic Energy and Railway operations (other than permitted activities)

CS YOGESH GUPTA  can be reached at & 7742681270


Author Bio

YOGESH GUPTA is founder of E & A CONSULTANTS LLP, Yogesh Gupta & Associates, He is a LAW Graduate, CA and CS. He has cumulative experience of more than 7 years with Listed Company, Chartered Accountants and Company Secretaries firms. Yogesh Gupta is a Learner, Researcher, and Author. He a View Full Profile

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  1. subbu says:

    Recently Govt. has increased the sectoral cap of FDI in defense to 74%. I have a question- if an existing Indian company already has some FDI & adds more FDI to reach 74% cap, will the sectoral cap is viewed as a total equity not exceeding 74% combination including existing & new infusion ? or only the infusion after the notification ?

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May 2024