Recently, the Union Cabinet approved a comprehensive proposal by the Department of Industrial Policy & Promotion (DIPP), reducing the minimum 10 hectare rule for serviced housing plots and cutting the minimum floor area for construction development projects to 20,000 sq. mtrs. from 50,000 sq. mtrs. to be eligible for overseas investment.1
The minimum FDI amount has also been reduced to $5 million from $10 million and the exit norms are reported to be substantially eased.
The certain major reforms are listed as follows:
1. Minimum foreign investment cut to $5m from $10m
2. Conditions set aside for hospitals, tourism, SEZ's, NRI's and old age homes
3. 3 Year lock-in removed developer can exit on completion or even earlier
4. Minimum floor area cut to 20,000 sq m. form 50,000 sq m.
The Notification / Press Release is not yet available on RBI or DIPP's website.
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