Foreign investment comes into India in various forms. Following the reforms path, the Reserve Bank has liberalized the provisions relating to such investments.

  • The Reserve Bank has permitted foreign investment in almost all sectors, with a few exceptions. Foreign companies are permitted to set up 100 per cent subsidiaries in India.
  • In many sectors, no prior approval from the Government or the Reserve Bank is required for non-residents investing in India.
  • Foreign institutional investors are allowed to invest in all equity securities traded in the primary and secondary markets. The total investment by all the foreign institutional investors put together should not exceed 24 per cent of the issued and paid up capital of a company which can be raised up to the level of the prescribed sectoral cap by the respective companies by passing a special resolution to the effect.
  • Foreign institutional investors have also been permitted to invest in Government of India treasury bills and dated securities, corporate debt instruments and mutual funds. The NRIs have the flexibility of investing under the options of repatriation and non-repatriation.
  • The Government allows Indian companies to issue Global Depository Receipts (GDRs) and American Depository Receipts (ADRs) to foreign investors The GDRs/ADRs issued by Indian companies to non-residents have free convertibility outside India.

All foreign investment through any of the channels mentioned above are required to be reported to RBI under FEMA, 1999.


Before reporting the transaction, applicant needs to obtain following:

  • Unique Identification Number from RBI by reporting of Advanced Foreign Remittance.
  • KYC report for the beneficiary if the beneficiary and remitter are different entities.
  • CS certificate
  • Certificate from SEBI registered Merchant Banker / Chartered Accountant indicating the manner of arriving at the price of the shares issued to the persons resident outside India
  • Disclaimer Certificate
  • Statutory Auditor Certificate
  • Board resolution
  • LRN(Loan Registration Number) allotted
  • copy of FIPB approval (if required)
  • Details of Transfer of shares if any
  • No objection certificate from the remitter for the shares being allotted to the third party mentioning their relationship
  • Letter from the foreign investor explaining the reason for making subscription to shares by the remitter on his behalf
  • Copy of agreement/Board resolution from the investee company for issue and allotment of shares to the foreign investor, other than the remitter
  • Reason for delay in submission (if required)
  1. Go to
  2. Register your username.
  3. Register your Company
  4. Download ARF and FCGPR from the Ebiz portal
  5. Fill up the entire form, you can check the mandatory attachments along with the form
  6. Attach DSC and upload the same on Ebiz portal.