Foreign Direct Investment in Petroleum Sector and Air Transport Services - FEMA - 004

Foreign Direct Investment in Petroleum Sector and Air Transport Services RBI/2005-06/83 AP (DIR Series) Circular No. 04 July 29, 2005 To All Banks Authorised to Deal in Foreign Exchange Madam / Sir, Foreign Direct Investment in Petroleum Sector and Air Transport Services Attention of Authorised Dealer (AD) banks is invited to the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000 notified vide Notification No. FEMA 20 /2000 - RB dated May 3, 2000, as amended from time to time. 2. The foreign direct investment (FDI) limit in the Petroleum sector and Air Transport Services (Domestic Airlines) under the Automatic Route, has been further liberalised by Government of India. Accordingly, FDI upto 100 per cent has been permitted under the Automatic Route in Petroleum Product Marketing, Oil Exploration in both small and medium sized fields and Petroleum Product Pipelines. In Air Transport Services (Domestic Airlines) sector, FDI upto 100 per cent has been permitted under the Automatic Route by Non-Resident Indians (NRIs) and upto 49 per cent by others. However, no direct or indirect equity participation by foreign airlines would be allowed. 3. Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) (Amendment) Regulations, 2005, Notification No. FEMA 130/2005-RB dated March 17, 2005 has been notified by Government vide G.S.R. No.201(E) dated April 01, 2005 (copy enclosed). 4. Authorised Dealer banks may bring the contents of this circular to the notice of their constituents and customers concerned. 5. The direction contained in this circular has been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and is without prejudice to permissions / approvals, if any, required under any other law. Yours faithfully (Vinay Baijal) Chief General Manager