New Delhi: Wooing global investors by easing FDI procedures, the Reserve Bank on Friday said that transfer of shares between Indians and non-residents would not require its permission in several key areas like financial services.
Amending the Foreign Exchange Management Regulations, the RBI said that its prior permission would not be necessary where the company whose shares are being transferred is engaged in any financial service.
"This is a welcome move and will specially help financial services firms and NBFCs which receive comparatively less FDI," Deloitte, Haskins & Sells Director Anis Chakravarty said.
The RBI permission has also been done away with for transfer of shares between residents and non-residents in cases where the Foreign Investment Approval Board (FIPB) has already given its clearances and the SEBI guidelines are met.
The steps have been taken "as a measure to further liberalise and rationalise the procedures and policies governing foreign direct investment in India," the RBI said.
However, it was made clear that the transactions will have to comply with the SEBI regulations, FDI sectoral caps, and the pricing guidelines as specified by RBI.
Crisil chief economist D K Joshi said, "This is part of the gradual liberalisation process and very positive. It will definitely help in brining more FDI."
While FDI inflows have gone up by 95 per cent to $ 17.37 billion between April and August, government and RBI want maintain robust foreign exchange reserves as volatility in the stock market has led to outflows.
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