• 28 July, 2021
Foreign Affairs. Geopolitics. National Security.

Govt notifies FDI policy in defence

Thu, 10 Dec 2020   |  Reading Time: < 1 minute

The government on December 08th notified changes in the Foreign Exchange Management Act permitting foreign direct investment (FDI) in defence production upto 74% on the automatic route and beyond that on the government route wherever it is likely to result in access to modern technology.

The government has also inserted a new condition in the Act related to beneficial ownership.

“Provided also that a Multilateral Bank or Fund, of which India is a member, shall not be treated as an entity of a particular country nor shall any country be treated as the beneficial owner of the investments of such Bank or Fund in India,” the Department of Economic Affairs said in a notification.

As per the notification, FDI up to 74% under automatic route shall be permitted for companies seeking new industrial licenses and foreign investment in the sector will be subject to security clearance by the home affairs ministry.

License applications will be considered by the Department for Promotion of Industry and Internal Trade in consultation with the ministries of defence and external affairs.


The opinions expressed in this article are the author’s own and do not reflect the views of Chanakya Forum. All information provided in this article including timeliness, completeness, accuracy, suitability or validity of information referenced therein, is the sole responsibility of the author. www.chanakyaforum.com does not assume any responsibility for the same.

Chanakya Forum is now on . Click here to join our channel (@ChanakyaForum) and stay updated with the latest headlines and articles.


We work round the clock to bring you the finest articles and updates from around the world. There is a team that works tirelessly to ensure that you have a seamless reading experience. But all this costs money. Please support us so that we keep doing what we do best. Happy Reading

Support Us


Leave a Comment