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Reuters

India announced on Monday sweeping reforms to rules on foreign direct investment, opening up its defence and civil aviation sectors to complete outside ownership and clearing the way for Apple to open stores in the country.
The reforms also loosen restrictions on inbound investments in pharmaceuticals and retail.
Apple is expected to be a beneficiary of a three-year relaxation India is introducing on local sourcing norms with an extension of up to five years possible if it can be proven that products are “state of the art”.
Other single-brand retailers like furniture giant IKEA are also expected to benefit.
Replacing ‘James Bond’: India begins search for new central bank chief to champion reforms
Defence contractors that have been reluctant to transfer technology to manufacture equipment in India would get the right to own local operations outright, up from 49 per cent previously.
In other changes, India allowed 100 per cent foreign direct investment (FDI) in civil aviation, following on from last week’s launch of a new policy that lowered barriers to entry for airlines that want to fly international routes.

The government also allowed foreign companies to own up to 74 per cent in ‘brownfield’ pharmaceuticals projects without prior government approval. India already allows 100 per cent ownership of greenfield pharma businesses.
The reforms announcement comes two days after India’s central bank governor Raghuram Rajan, feted by foreign investors, announced he would not be available for reappointment when his term expires in September.
Rajan’s decision, whose reforms have been credited for much of the economy’s success in recent years, came as a jolt to the country’s financial markets. The rupee fell to a near one-month low and bonds weakened on Monday.
The last time Prime Minister Narendra Modi’s two-year-old government announced a loosening of FDI norms was after his nationalist political party suffered a heavy defeat in a state election last autumn.


India opens door to foreign investors by announcing  sweeping economic reforms

India's Prime Minister Narendra Modi gestures to Reserve Bank of India Governor Raghuram Rajan. Photo: Reuters

epa05371743 India's indigenous basic trainer aircraft, the Hindustan Turbo Trainer HTT40, are on display prior to an inaugural flight in Bangalore, India, 17 June 2016. The Hindustan Aeronautics Limited (HAL) HTT40 tandem seat aircraft weighs about 2,800 kg and is propelled by a 1,100 hp turboprop engine. The trainer aircraft is also prepared to be equipped with weapon slots. The Indian Air Force is expected to include the HTT40 aircraft into its fleet by 2018. EPA/JAGADEESH NV

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