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New FDI Policy for Railway Infrastructure and Defence

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The Reserve Bank of India notified the government’s decision to increase foreign direct investment ceiling in defence sector and permitting 100 per cent FDI in railways infrastructure.

In the defence sector, foreign investment up to 49 per cent has been permitted under government route in the defence sector. The earlier cap was 26 per cent.

In the railway segment, FDI will be allowed in construction, operation and maintenance of suburban corridor projects through PPP, MRTS (Mass Rapid Transport Systems), high speed train projects and dedicated freight lines. FDI has also been allowed in rolling stock including train sets, and locomotives/coaches manufacturing and maintenance facilities, railway electrification, signaling systems, freight terminals and passenger terminals, among others.