Entities into which Foreign Direct Investment can be made
Today, we will share our views on entities into which FDI can be made.
THE ELIGIBLE ENTITIES ARE:
1. Partnership Firm / Proprietary Concern
2. Venture Capital Fund
3. Trusts
4. An Indian Company
5. Limited Liability Partnerships (LLPs)
FDI in Partnership Firm / Proprietary Concern:
(i) A Non-Resident Indian (NRI) or a Person of Indian Origin (PIO) resident outside India can invest in the capital of a firm or a proprietary concern in India on non-repatriation basis :

(a) Amount is invested by inward remittance or out of NRE/FCNR(B)/NRO account maintained with Authorized Dealers / Authorized banks.

(b) No Investment not engaged in any agricultural/plantation or real estate business or print media sector.

(c) Amount invested shall not be eligible for repatriation outside India.

(ii) Investments with repatriation option: For availing repatriation option, NRIs/PIO may seek prior permission of Reserve Bank for investment in sole proprietorship concerns/partnership firms. The application will be decided in consultation with the Government of India.
(iii)Investment by non-residents other than NRIs/PIO: A person resident outside India other than NRIs/PIO may make an application and seek prior approval of Reserve Bank for making investment in the capital of a firm or a proprietorship concern or any association of 16 persons in India. The application will be decided in consultation with the Government of India.
(iv)Restrictions: No invest in a firm or proprietorship concern engaged in any agricultural/plantation activity or real estate business or print media.
FDI in Venture Capital Fund (VCF): FVCIs are allowed to invest in Indian Venture Capital Undertakings (IVCUs) /Venture Capital Funds (VCFs) /other companies. If a domestic VCF is set up as a trust, a person resident outside India (non-resident entity/individual including an NRI) can invest in such domestic VCF subject to approval of the FIPB. However, if a domestic VCF is set-up as an incorporated company under the Companies Act, 2013, then a person resident outside India (non-resident entity/individual including an NRI) can invest in such domestic VCF under the automatic route of FDI Scheme, subject to the pricing guidelines, reporting requirements, mode of payment, minimum capitalization norms, etc.
FDI in Trusts: FDI in Trusts other than VCF is not permitted.
FDI in an Indian Company: Indian companies can issue capital against FDI
Thanks
-With Warm Regards
CA Sanskriti Jain
Mb. No- 8745961214
Email Id- [email protected]