Legal & Regulatory
Nov. 7 – After markets closed on Wednesday, the Reserve Bank of India, the country’s Central Bank, announced a series of new regulations that will allow foreign banks much greater access to the country’s domestic market. The domestic market had previously been highly protected against added competition from foreign banks.
In essence, under the new regulations, foreign banks will be treated the same as domestic banks.
In order to be eligible under the new regulations, foreign banks much switch from how they currently operate in India by upgrading from a branch to a wholly owned subsidiary structure. Upon forming the subsidiary, foreign banks are required to invest at least US$80 million (5 billion rupees).
Oct. 28 – Following years of production deficits, the Indian government will now seek public-private partnerships (PPP) in the coal sector to boost domestic production, according to a draft agreement submitted this month by the Planning Commission.
The coal sector, which is largely dominated by the state-owned mining company Coal India, has experienced perennial production deficits and meets only three-quarters of the 773 million ton annual domestic demand.
By allowing PPPs, the Planning Commission hopes to rekindle the Indian energy sector through increased competition among coal producers.
“The only option before us is to increase domestic production and since Coal India is struggling to meet domestic requirement, it is best to involve private players, who will produce faster and cheaper coal,” said a senior official with the Planning Commission.
Sept. 30 – When applying for a long-term visa in India, there are a number of procedures and legal frameworks that must be understood. In this article, we discuss the documents necessary for a foreigner to work in India.
India provides two kinds of work-related visas: a business visa, also called a B visa, and an employment visa, also called an E visa. A multiple entry business visa can be granted for a period of up to five years, with the maximum allowable stay period per visit to be determined by the issuing Indian mission.
Sept. 24 – Hyderabad is soon to be home to a new Information Technology Investment Region (ITIR) following last week’s approval by the Cabinet Committee on Economic Affairs for new ITIR developments.
The ITIR, which will include special economic zones and industrial parks, is expected to become a key information technology hub in the region and will focus on accommodating small and medium sized information technology (IT) and information technology enabled service (ITES) enterprises.
Sept. 24 – The Indian government is currently working to set up a long-term infrastructure trust fund that would be open to both foreign and Indian investors – which would be similar to the real estate investment trusts in countries such as Singapore, Hong Kong and the US – by the end of this year in a move to boost further investments into the country’s wavering infrastructure sector.
Over the past years, India’s infrastructure sector has struggled to secure financing for projects since banks have been unwilling to lend because of policy constraints and since private investors have also been hesitant to provide funding due to the recent volatility within the country. This is where such a trust fund would come in.
By Dezan Shira & Associates, Delhi Office
Sept. 17 – India is fast emerging as a global trade dynamo with its vast natural resources and huge supply of skilled labor. Undertaking considerable industrial deregulation and other structural reforms, regulators in India recognizes that strong exports are critical for overall economic growth and poverty reduction. As such, export-led growth has become a key driver of trade in India – one of the most important trailblazers in the recent enormous expansion of international trade.
Indian trade has grown exponentially over the past few years, with exports rising at a rate well above the pace of growth of worldwide exports. In this atmosphere, opportunities have never been greater, and starting a trading business in India has never been easier.
Sept. 16 – The new issue of Asia Briefing Magazine, titled Work Visa and Permit Procedures Across Asia, is out now and will be temporarily available as a complimentary PDF download on the Asia Briefing Bookstore throughout the months of September and October.
Demand for skilled foreign nationals remains high across Asia, but when conducting business as a foreign national in a foreign country, it is important to be aware of the regulations governing foreign executives’ stay abroad. Employers with a physical presence in these markets must also understand the proper procedures for sponsoring a foreign worker.
The necessary documents required for a foreign national working in Asia vary country to country, but typically include a specific work visa, a work permit, and/or a residence permit. However, short-term visits for purposes of due diligence, quality control, or trade fairs, for example, may be covered through the issuance of business visas.
Sept. 5 – After nearly ten years of debates and negotiations, the Lok Sabha – India’s lower house of Parliament – finally cleared the long-awaited Pension Fund Regulatory and Development Authority (PFRDA) Bill today in a step towards creating a stronger pension industry and to attract additional foreign and private sector investments.
The bill must now go to the Rajya Sabha – India’s upper house of Parliament – where it is expected to obtain final approval soon.
“When the bill is passed, I expect that some more [foreign direct investment] will come in,” Indian Finance Minister P. Chidambaram commented.