‘India’s story starts with the people and not with the government. It’s been a miracle how the Indian Economy has outperformed its peers despite the poor quality of governance. With about 20% of the world’s population, India is a major consumer and a huge market. You can love it, hate it but you can’t ignore it.’ – Mohit Suri

India has emerged as a preferred destination for foreign direct investment in the recent years. A survey by the United Nations Conference on Trade and Development (UNCTAD) has stated that India has emerged as the second most popular and preferable destination in the entire world, after China, for highly profitable foreign direct investment.

Until recently most of the foreign direct investment was in sectors like IT, infrastructure, telecom and hospitality only. Whereas now, the Indian government has opened up Foreign Direct Investment in sectors like, retail, natural gas, insurance, defence equipment production, basic and cellular services and select agricultural sectors. All said, investing in foreign countries can be a minefield where a single wrong move can spell doom for the investor. We at MLegal assist clients in avoiding the pitfalls while reaping the benefits.

Our FDI Law Practice covers:

  • Company formation and corporate compliance services.
  • Establishment of joint ventures.
  • Corporate and commercial law services for making all mandatory compliances.
  • Drafting all requisite contracts, agreements, and other documents.
  • Setting up subsidiaries.
  • Tax planning.
  • Project finance.
  • Dispute resolution.
  • Private equity.
  • Other legal services for FDI in India.



The Indian government has recently approved 51% FDI in retail under the automatic route and this is sure to stir investors. The Retail sector of India is vast, with great potential, but a very unorganized constituent base. The retail sector of India handles about $250 billion every year, and is expected by veteran economists to reach to $660 billion by the year 2015. The business in the organized retail sector of India, is to grow at the rate of 15-20% every year, and can reach the level of $100 billion by the year 2015. The retail in India has been dominated by traditional ‘Mom-n-Pop’ stores with organized retail contributing only 15% of the total revenue. The opportunity is huge and global retailers like Wal-Mart,
Tesco, Carrefour and Target are already spreading their footprint in the country.


The Sectoral Cap for the Insurance Sec tor has been approved to be increased to 49% under the automatic route. This also means an increase to 49% FDI for Pension Funds as well. India is a largely uninsured nation with limited awareness. This sector is bound to attract a huge amount of FDI due to the expanding nature of the Indian Insurance Sector. Pension Funds will also find a large number of takers in India with most urban youth of India employed in jobs that are not pensionable. These are conducive conditions for companies interested in breaking into untapped markets.


India’s defence bud get is over 30 billion dollars and more than 70 % of it is spent on imports every year. The defence budget will cross 50 billion dollars in the next five years and India will become the highest importer of arms in the world. The FDI cap in this sector remains 26% through the Government Route but comes with an added provision of case to case clearance which depends upon the provision of state of the art technology and no cap is mentioned under this. With the sheer magnitude of this sector, investment in India is highly attractive.