# Foreign Direct Investment (FDI) in India: Policy & Routes
> Learn about FDI vs FPI, the role of FIPB, automatic vs government routes, and India's investment milestones and sectoral limits for international investors.

Tags: fdi, fpi, foreign-direct-investment, business-india, economics, finance, investment-policy
## Foreign Direct Investment (FDI) Overview
* FDI involves cross-border investment where an investor acquires lasting interest (10%+) in a foreign business.
* Key benefits include technology transfer, economic growth, and job creation.

## Types of FDI
* **Horizontal:** Replicating same business operations abroad.
* **Vertical:** Expanding supply chain (upstream/downstream).
* **Conglomerate:** Investing in unrelated businesses.
* **Greenfield:** New facilities from scratch.
* **Brownfield:** Mergers or acquisitions.

## Regulation & Routes in India
* **Automatic Route:** No prior approval needed; notification to RBI post-investment for sectors like IT and Manufacturing.
* **Government Route:** Prior approval required for strategic sectors like Defence and Print Media.
* **FIPB:** Abolished in 2017; approvals now handled by sectoral ministries.

## Sectoral Limits
* Agriculture & Animal Husbandry: 100% (Automatic).
* Defence: 74% (Automatic) / 100% (Government).
* Private Banking: 74% (Automatic).
* Single-brand Retail: 100% (Automatic).
* Multi-brand Retail: 51% (Government).

## FDI vs FPI Differences
* **FDI:** Long-term, direct management control, stable, creates infrastructure.
* **FPI:** Short-term financial assets (stocks/bonds), passive investor, highly volatile and liquid.

## Milestones in India
* 1991: Economic liberalization.
* 2014: 'Make in India' initiative.
* 2021-22: Record FDI inflow of USD 84.8 Billion.
---
This presentation was created with [Bobr AI](https://bobr.ai) — an AI presentation generator.