With the aim of enhancing “ease of doing business” and “promoting the principle of Maximum Governance and Minimum Government”, the Government of India abolished the Foreign Investment Promotion Board on May 24, 2017. In its place, the relevant administrative ministry/department in consultation with the Department for Promotion of Industry and Internal Trade are now directly responsible for processing applications for foreign direct investment in India in sectors which require prior approval of the Government.
The move was expected to make the process of obtaining FDI approval faster and more efficient. Almost three years after the move, we consider in this note the current framework for FDI approval and areas for improvement.