MINISTRY OF FINANCE

DEPARTMENT OF ECONOMIC AFFAIRS

LOK SABHA

UNSTARRED QUESTION NO.2907

TO BE ANSWERED ON FRIDAY, DECEMBER 02, 2016/

AGRAHAYANA 11, 1938 (SAKA)

“Foreign Capital Inflows and Outflows”

QUESTION

2907: SHRI ANANT KUMAR HEGDE

Will the Minister of FINANCE be pleased to state:

(a) the details of foreign capital inflows and outflows from India during the last three years and current year;

(b) whether the Government is aware of increase in foreign capital outflow compared to the inflows, and

(c) if so, the details thereof and reasons therefor and steps taken to check the trend?

ANSWER

MINISTER OF STATE IN THE MINISTRY OF FINANCE

(SHRI ARJUN RAM MEGHWAL) 

(a) The details of foreign capital inflows and outflows from India during the last three years and current year is placed at the Annex.

(b) & (C) Government in consultation with regulators have taken a number of steps to boost the inflow of foreign capital to the country and check outflow. The limits for Foreign Portfolio investment (FPI) in the Central Government securities are being increased in phases to reach 5 per cent of the outstanding stock by March 2018. FPIs are also permitted to invest in units of Real Estate Investment Trusts, Infrastructure Investment Trusts and Category III Alternative Investment Funds. All investments by FPIs in Central Government Securities and State Development Loans (SDL) and corporate bonds are required to be made in securities having a minimum residual maturity of 3 years. Changes introduced in the Foreign Direct Investment Policy (FDI) policy to promote FDI inflows include increase in sectoral caps, bringing more sectors under automatic route and easing of conditionalities for foreign investment.