Non-repatriable investments by NRIs, OCIs and PIOs will be treated as domestic investments and will not be subject to foreign direct investment caps, the Commerce and Industry Ministry today said.
"The government has reviewed the FDI policy relating to investments by NRIs, PIOs and OCIs. It has been decided to amend the definition of NRIs as contained in the FDI policy.
"... and also to provide that for the purposes of FDI policy, investment by NRIs under Schedule 4 of FEMA...regulations will be deemed to be domestic investment at par with the investment made by residents," a press note said.
It said NRIs would also include Overseas Citizens of India (OCIs) and Persons of Indian origin (PIOs).
Last month, the Cabinet, chaired by Prime Minister Narendra Modi, had cleared these amendments.
The decision is expected to result in increased investments across sectors and greater inflow of foreign exchange remittances leading to higher economic growth.
The government has also notified increase in FIPB's power to recommend foreign investment proposals of up to Rs 3,000 crore from the earlier Rs 2,000 crore.
"The Finance Minister would consider the recommendations of FIPB on proposals with a total foreign inflow up to Rs 3,000 crore," another statement said.
Beyond this limit, proposals will go to the Cabinet Committee on Economic Affairs for approval.
The Department of Industrial Policy and Promotion (DIPP), which deals in FDI related matters, issues provisions in the form of press notes or consolidated circular.
In April-February of 2014-15, FDI rose 39 per cent to USD 28.81 billion as against USD 20.76 billion in the same period previous fiscal.