Review of the Policy on FDI in the Manufacture of Cigarettes Etc
1.0
The Present Position
The present policy of Government of India permits 100% Foreign Direct
Investment (FDI) under Government route i.e. with prior approval of Foreign
Investment Promotion Board (FIPB) in the manufacture of Cigars & Cigarettes,
subject to obtaining industrial license under the Industries (Development &
Regulation) Act, 1951.
The Government of India has reviewed the extant policy and it has been
decided to prohibit FDI in manufacturing of 'Cigars, cheroots, cigarillos
and cigarettes, of tobacco or of tobacco substitutes' (Code 24.02 of Indian
Trade Classification which follows the Harmonized Commodity Description and
Coding System) and to include the activity in the list of activities/sectors
prohibited for FDI.
3.0 Accordingly, the following amendments are made in the Consolidated FDI
Policy issued vide Department of Industrial Policy & Promotion Circular 1 of
2010 dated March 31, 2010.
3.1 Para 5.7 relating to Cigars & Cigarettes, stands deleted.
3.2 In paragraph 5.1, which lists the sectors where FDI is
prohibited, a new entry below the entry (i) is inserted as follows:
j) Manufacturing of Cigars, cheroots, cigarillos and cigarettes, of
tobacco or of tobacco? substitutes. "
4.0 The above decision will take immediate effect.
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