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Investment will be subject to
the following conditions:
(A) Minimum area to be
developed under each project would be as under:
i.
In
case of development of serviced plots, no minimum land area requirement.
ii.
In
case of construction-development projects, a minimum floor area of 20,000 sq.
meter.
(B) Investee company will
be required to bring minimum FDI of US$ 5 million within six months of
commencement of the project. The commencement of the project will be the date
of approval of the building plan/lay out plan by the relevant statutory
authority. Subsequent tranches of FDI can be brought till the period of
tenyears from the commencement of the project or before the completion of
project, whichever expires earlier.
(C)(i) The investor will be
permitted to exit on completion of the project or after development of trunk
infrastructure i.e. roads, water supply, street lighting, drainage and
sewerage.
(ii)The Government may, in
view of facts and circumstances of a case, permit repatriation of FDI or
transfer of stake by one non-resident investor to another non-resident
investor, before the completion of project. These proposals will be
considered by FIPB on case to case basis inter-alia with specific reference
to Note (i).
(D) The project shall conform
to the norms and standards, including land use requirements and provision of
community amenities and common facilities, as laid down in the applicable
building control regulations, bye-laws, rules, and other regulations of the
State Government/Municipal/Local Body concerned.
(E) The
Indian investee company will be permitted to sell only developed plots. For
the purposes of this policy “developed plots” will mean plots where trunk
infrastructure i.e. roads, water supply, street lighting, drainage and
sewerage, have been made available.
(F) The
Indian investee company shall be responsible for obtaining all necessary
approvals, including those of the building/layout plans, developing internal
and peripheral areas and other infrastructure facilities, payment of
development, external development and other charges and complying with all
other requirements as prescribed under applicable rules/bye-laws/regulations
of the State Government/ Municipal/Local Body concerned.
(G) The
State Government/ Municipal/ Local Body concerned, which approves the
building / development plans, will monitor compliance of the above conditions
by the developer.
Note:
(i)
It is
clarified that FDI is not permitted in an entity which is engaged or proposes
to engage in real estate business, construction of farm houses and trading in
transferable development rights (TDRs).
“Real
estate business” will have the same meaning as provided in FEMA Notification
No. 1/2000-RB dated May 03, 2000 read with RBI Master Circular i.e. dealing
in land and immovable property with a view to earning profit or earning
income therefrom and does not include development of townships, construction
of residential/ commercial premises, roads or bridges, educational
institutions, recreational facilities, city and regional level
infrastructure, townships.
(ii)
The conditions at (A) to (C)
above, will not apply to Hotels & Tourist resorts; Hospitals; Special
Economic Zones (SEZs); Educational Institutions, Old Age Homes and Investment
by NRIs.
(iii)
The conditions at (A) and (B)
above, will also not apply to investee/joint venture companies which commit
at least 30 percent of the total project cost for low cost affordable
housing.
(iv)
An Indian
company, which is the recipient of FDI, shall procure a certificate from an
architect empanelled by any Authority, authorized to sanction building plan
to the effect that the minimum floor area requirement has been fulfilled.
(v)
‘Floor
area’ will be defined as per the local laws/regulations of the respective
State governments/Union territories.
(vi)
Completion
of the project
will be determined as per the local bye-laws/ rules and other regulations of
State Governments.
(vii)
Project using at least 40% of the
FAR/FSI for dwelling unit of floor area of not more than 140 square meter
will be considered as Affordable Housing Project for the purpose of FDI
policy in Construction Development Sector. Out of the total FAR/FSI reserved
for Affordable Housing, at least one-fourth should be for houses of floor
area of not more than 60 square meter.
(viii) It is clarified that 100% FDI
under automatic route is permitted in completed projects for operation and
management of townships, malls/ shopping complexes and business centres.
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