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FDI Highlights in Union Budget 2014-15

The Finance Minister has set himself to uproot the situation of Fiscal Crisis in India and have set out a target to be achieved in the fiscal year 2015 at 4.1%. Further, he has tried to repose the confidence amongst the foreign investors by increasing the FDI limit in some sectors and has also abolished the controversial retrospective tax.

The major sectors amongst the increase are as follows:

FDI in Insurance: The Government  has increased the foreign investment in this sector to 49% from 26% which would further be proven as a benefit for the insurance companies to sell their shares abroad and would lead to foreign capital participation.

FDI in Defence: Increase has been from 26% to 49%. This very step has been very crucial as the country imports the defence equipments from outside India, so now when the import restriction would now only be limited to 49%, so the rest 51% will be purchased from the Indian Defence Manufacturers and this would reduce the burden and Indian markets would flourish creating lots of employment opportunities at the same time.

No retrospective tax: The Government has panned to do away with the retrospective tax as all the cases of retro taxes would be moved to the higher level.

FDI in ecommerce sector: Liberalised policy for the foreign entities to enter into the Indian markets for ecommerce would lead to the increased business and at the same time increase the employment opportunities.

FDI in health insurance sector: This increase to 49% would lead to the physical access to the Doctors and fast services which could improve the healthcare of the country. 

The move will prove as an overall benefit for the country and would create a healthy competition so as to benefit all the constituents in the economy.

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