Welcome to the April 2, 2015 bulletin of key policy decisions and high-impact news from India, presented by the Embassy of India, in Washington D.C.
Key Policy Decisions

Government Unveils New Foreign Trade Policy  

          

Aiming to nearly double India's exports of goods and services to USD 900 billion by 2020, the Government has announced several incentives in the five-year Foreign Trade Policy (FTP) for exporters and units in the Special Economic Zones. Commerce Minister Nirmala Sitharaman said the FTP will introduce Merchandise Exports from India Scheme (MEIS) and Services Exports from India Scheme (SEIS) to boost outward shipments.  

  

Market Regulator Sets Guidelines for Intl. Financial Centers


Market regulator SEBI has issued a detailed and relaxed set of guidelines for establishing international financial services centers (IFSC) around the country. The game-changing rules are aimed at creating vibrant IFSCs within India.       

  
Retro Tax Law not Applicable on Dividends by Foreign Firms
Dividends declared by a foreign company, having assets in India, to another overseas arm will not be taxable in India. The Central Board of Direct Taxes has issued a direction to clarify a three-year-old retrospective amendment to tax indirect transfers. This will also provide tax certainty to foreign investors.   

  

Govt. OKs Plan to Create 101 National Waterways to Improve Logistics 

                     
In a bid to boost transportation for goods and passengers through waterways, the Government has approved enactment of Central legislation for converting 101 river stretches across the country into National Waterways. India currently has only five such National Waterways.

Govt. Clears 10 Foreign Investment Proposals Worth $457 mn 

                  

The Foreign Investment Promotion Board has cleared 10 foreign direct investment proposals worth $457 million. The proposals include one from Hong Kong-based retailer Wacoal to set up a joint venture in India. Other proposals come in the pharma, renewable energy and healthcare sectors. 

Financing Vehicle Approved to Fund Port-Related Rail 

                     

To fund port-related railway projects, the Government has approved a special purpose vehicle (SPV) with initial capital of $80 million. "The SPV would be funded by all the 12 major ports and the Rail Vikas Nigam. Major ports would contribute 90 percent of the equity with RVNL contributing the rest," an official statement read.  
High-Impact News

Defense Sector in Line to Reap $250 Billion in New Business

India's defense sector is expected to offer opportunities worth $250 billion within the next seven to eight years as the Government is seeking increased private sector investments in the area, according to Amitabh Kant, Secretary, Department of Industrial Policy and Promotion. 
 

Ford: India will be World's 3rd-Largest Automaker by 2020                   

India is on pace to produce 7 million cars per year by 2020, making it the world's third-largest automaker, David Dubensky, President and Managing Director of Ford Motor said. The automotive sector has a direct bearing on the economy, contributing nearly 7 percent to GDP.  

 
Twitter CEO: India's Startup Climate Feels Like Silicon Valley    

 

India's entrepreneurial environment resembles Silicon Valley in many ways, said Twitter CEO Dick Costolo. "When you walk into a room here, it is less about the PowerPoint slides and more about 'Let's just get right to what we need to talk about and do here", he said. "And that's exciting to me as it maps very directly to how Silicon Valley and San Francisco work", said Costolo during his recent visit to India, where he met Prime Minister Narendra Modi and other officials. 
Jaitley Promises to Step Up Public Funding for Infrastructure 
  
Finance Minister Arun Jaitley promised to step up public spending on infrastructure, ease entry barriers for overseas investors and push a Goods and Services Tax to boost economic expansion. He also called for low interest rates .
M&As Worth $28.6 billion in 2014; Inbound Deals Dominate 
  
Reflecting positive investor sentiment in the Indian economy, 870 mergers and acquisitions worth $28.6 billion were announced in 2014 -- up 6 percent over the preceding year, says a study.

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