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Hi Megha, FDI is prohibited under the Government Route as well as the Automatic Route in the following sectors: i) Atomic Energy ii) Lottery Business iii) Gambling and Betting iv) Business of Chit Fund v) Nidhi Company vi) Agricultural (excluding Floriculture, Horticulture, Development of seeds, Animal Husbandry, Pisciculture and cultivation of vegetables, mushrooms, etc. under controlled conditions and services related to agro and allied sectors) and Plantations activities (other than Tea Plantations) vii) Housing and Real Estate business (except development of townships, construction of residen­tial/commercial premises, roads or bridges to the extent specified in Notification No. FEMA 136/2005-RB dated July 19, 2005). viii) Trading in Transferable Development Rights (TDRs). ix) Manufacture of cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes.

**Which are the sectors where FDI is not allowed in India, under the Automatic Route as well as Government Route?** ----Indian government has allowed foreign direct investment 100% is allowed under the automatic route in all activities/sectors except for which government approval need. --FDI in activities not covered under the automatic route requires prior Government approval and are considered by the Foreign Investment Promotion Board (FIPB), Ministry of Finance. --**Following are the sectors where FDI is not allowed in India, under the Automatic Route as well as Government Route** FDI is prohibited under Government as well as Automatic Route for the following sectors: i) Retail Trading (except single brand product retailing) ii) Atomic Energy iii) Lottery Business iv) Gambling and Betting v) Business of Chit Fund vi) Nidhi Company vii) Agricultural or plantation activities (cf Notification No. FEMA 94/2003-RB dated June 18, 2003). viii) Housing and real estate business (except development of townships, construction of residential/commercial premises, roads or bridges to the extent specified in Notification No. FEMA 136/2005-RB dated July 19, 2005 ) ix) Trading in Transferable Development Rights (TDRs).

India’s foreign direct investment (FDI) rules have been substantially liberalized over the past several years. Most sectors are now open to 100% FDI, meaning thereby, that the foreign companies do not need a prior approval for investment either by the Government or the Reserve Bank of India. The investors are only required to intimate the Regional office concerned of the Reserve Bank within 30 days of receipt of inward remittance. The automatic route allows Indian companies engaged in various industries to issue shares to foreign investors up to 100% of their paid up capital in Indian companies. The investors are also required to file necessary documents within 30 days of issue of shares. The following documents need to be filed with the RBI: Name of the collaborators/ promoters/ shareholders Details of allotment Copy of the foreign collaboration agreement The original foreign inward remittance certificate from the authorised dealer and other specified information What is Approval route in FDI? There are certain activities that are not covered under the automatic route and that require prior Government approval and are considered by the Foreign Investment Promotion Board (FIPB). Following list include the activities for which automatic route for foreign investment is not available: Banking, NBFC's Activities in Financial Services Sector, Civil Aviation, Petroleum Including Exploration/Refinery/Marketing, Housing & Real Estate Development Sector for Investment from Persons other than NRIs/ OCBs, Venture Capital Fund and Venture Capital Company, Investing Companies in Infrastructure & Service Sector, Atomic Energy & Related Projects, Defence and Strategic Industries, Agriculture (Including Plantation), Print Media, Broadcasting, Postal Services. Applications for all FDI cases except Non-Resident Indian (NRI) investments, 100% Export Oriented Units (EOUs) should be submitted to the FIPB Unit, Department of Economic Affairs (DEA) Ministry of Finance. However application for NRI investment and 100% EOU cases should be presented to Secretariat for Industrial Assistance (SIA) in Department of Industrial Policy & Promotion. (DIPP).

Hi Megha, A foreign direct investment (FDI) is an investment made by a company or entity based in one country, into a company or entity based in another country. Entities making direct investments typically have a significant degree of influence and control over the company into which the investment is made. **FDI is prohibited under the Government Route as well as the Automatic Route in the following sectors:** i) Atomic Energy ii) Lottery Business iii) Gambling and Betting iv) Business of Chit Fund v) Nidhi Company vi) Agricultural (excluding Floriculture, Horticulture, Development of seeds, Animal Husbandry, Pisciculture and cultivation of vegetables, mushrooms, etc. under controlled conditions and services related to agro and allied sectors) and Plantations activities (other than Tea Plantations) vii) Housing and Real Estate business (except development of townships, construction of residen­tial/commercial premises, roads or bridges to the extent specified in Notification No. FEMA 136/2005-RB dated July 19, 2005). viii) Trading in Transferable Development Rights (TDRs). ix) Manufacture of cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes.