Downstream Investment and its legal framework
The economic development of India has witnessed a significant boom and by infusion of foreign direct investments from all across the world. Foreign direct investment is said to be undertaken when an entity registered out of the borders of the country invests in India. The Government of India formulated the Foreign Direct Investment Policy (“ FDI Policy ”) to regulate the various foreign direct investments in India. With foreign investments gradually occurring in debt instruments and non-debt instruments, there was a requirement for a proper regulatory structure with respect to investments specifically in non-debt instruments, for instance, investments in equity instruments in incorporated entities, LLP capital participation, investments in alternative investment funds, instruments notified under the FDI Policy. Further, foreign direct investments in India may further be undertaken indirectly by different foreign entities, by channelizing the investments through an e...