FOREIGN DIRECT INVESTMENT
- An investment made by a company or entity based in one country, into a company or entity based in another country is called Foreign Direct Investment.
- Open economies with skilled workforces and good growth prospects like India tend to attract larger amounts of foreign direct investment than closed, highly regulated economies.
- The investing company may make its overseas investment in a number of ways - either by setting up a subsidiary or associate company in the foreign country, by acquiring shares of an overseas company, or through a merger or joint venture
- Due to globalization, the importance of FEMA/ RBI Compliance has increased manifold. It include chartered Accountants Certification for transactions prescribed in the FEMA/ RBI regulations, making prescribed applications to Reserve Bank of India for various FEMA and RBI regulated transactions, advisory services related to FEMA / RBI matters.
- Compliance with FDI regulations and getting regulatory approvals
- Compliance of the procedure including Chartered Accountants’Certification for repatriation of income/assets from India
- Transfer of shares from Indian resident to non-resident. Etc.
Flow Chart showing the Process of Reporting the Foreign Direct Investment to RBI as per regulations under FEMA Act