Which changes will take place in India this year (2014) due to the foreign direct investment (FDI) reforms?

A number of changes in FDI caps have already been hinted at for this year. FDI caps and foreign institutional investors (FII) prohibition in the defense sector may soon be relaxed for investment promoting the development of ‘state-of-art’ military technology. More recent developments suggest India may even move to liberalize business-to-consumer e-commerce, railways and the construction industry in the near future after FDI slowed considerably in the April-November period of the current fiscal year. In bonds, the government may transition from a fixed ceiling on FII in government securities to instead link limits to proportion of gross domestic product (GDP). The government has already clarified that the existing 26 percent cap on foreign investment in the insurance sector also applies to intermediaries such as brokers, third party administrators and surveyors.