Hudson Insurance Company is a US company desires to expand its insurance business in India under Foreign Direct Investment policy of the Government of India. You are required to suggest the company about the current FDI

Foreign Direct Investment (FDI) is a category of cross border investment made by a resident in one economy (the direct investor) with the objective of establishing a 'lasting interest' in an enterprise (the direct investment enterprise) i.e. resident in an economy other than that of the direct investor. Foreign Direct Investment (FDI) means investment, by a non-resident entity/person resident outside India in the capital of an Indian company, under Schedule 1 of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations. It is governed by the provisions of the Foreign Exchange Management Act (FEMA), 1999. Foreign Direct Investment (FDI) in India is undertaken in accordance with the FDI Policy which is formulated and announced by the Government of India with the intent and objective of the Government of India to attract and promote foreign direct investment in order to supplement domestic capital, technology and skills, for accelerated economic growth. Government has put in place a liberal policy on FDI, under which FDI, up to 100%, is permitted, under the automatic route, in most sectors/activities. There is a small list of sectors, which are either prohibited for FDI, or are subject to restrictions in the nature of equity caps, entry route or conditionalities. Further, the FDI policy is reviewed on an ongoing basis, with a view to making it more investor-friendly. Significant changes have been made in the FDI policy regime in recent times, to ensure that India remains an increasingly attractive investment destination. The Foreign Direct Investment (FDI) Policy, at present, 49% FDI is allowed in (i) Insurance Company (ii) Insurance Brokers (iii) Third Party Administrators (iv) Surveyors and Loss Assessors (v) Other Insurance Intermediaries appointed under the provisions of Insurance Regulatory and Development authority Act, 1999 under Automatic route.