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Clarification issued on FDI in farm, real estate sector

Special Correspondent

NEW DELHI: The Union Government has clarified that Foreign Direct Investment is not permitted in any farm or real estate sector other than those specifically mentioned in the FDI policy. According to a Press Note issued by the Department of Industrial Policy and Promotion here on Wedneday, apart from sectors mentioned in the FDI policy under the Press Note 4 issued on February 10 this year, FDI in other sectors is not permitted. It clarifies that the existing policy in the agriculture and plantation sector is that FDI up to 100 per cent is permitted under automatic route in floriculture, horticulture, development of seeds, animal husbandry, pisciculture, aqua-culture, vegetable cultivation, mushrooms under controlled conditions and services related to agro and allied sectors.

In addition, FDI up to 100 per cent with prior government approval is permitted in tea plantation subject to the condition that the foreign company would divest 26 per cent equity to an Indian partner or Indian public within five years. Prior approval of the state government concerned would also be required in case of any future land use change.

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