India formally allows FDI from Pakistan

Thursday, August 02, 2012
New Delhi: Indian government on Wednesday formally allowed foreign direct investment (FDI) from Pakistan.

The move to allow FDI from Pakistan is seen as a series of confidence building measures to build trust between both the nuclear-armed neighbours who were already engaged in acrimonious war of maintain co-status over several issues.

Reviewing its investment policy government has decided to permit a citizen of Pakistan or an entity incorporated in Pakistan to make investments in India, under the Government route, in sectors/activities other than defence, space and atomic energy.

According to the amendment made to paragraph 3.1.1 of circular 1 of 2012, a non-resident entity can invest in India, subject to the FOI Policy. A citizen of Bangladesh or an entity incorporated in Bangladesh can invest only under the Government route.

Notably, the above decision will take immediate effect.
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