# NDI Rules 2019 — Schedule I Sector Table

*Source: Foreign Exchange Management (Non-debt Instruments) Rules, 2019, Schedule I,
as amended. Always verify each entry against the current version of the NDI Rules PDF
before completing any assessment. This table is a reference summary — not a substitute
for the authoritative statutory text.*

---

## Prohibited Sectors — Schedule I(2)

FDI is absolutely prohibited (not merely restricted) in:

1. Lottery business of any kind (including government lotteries and online lotteries)
2. Gambling and betting, including casinos
3. Chit funds
4. Nidhi companies
5. Trading in Transferable Development Rights (TDRs)
6. Real estate business or construction of farm houses
   *(Note: development of townships, construction of residential/commercial premises,
   roads, bridges, and hotels/hospitals is permitted — it is real estate trading/
   brokerage and farm house construction that is prohibited)*
7. Manufacturing of cigars, cheroots, cigarillos, or cigarettes of tobacco or tobacco
   substitutes
8. Atomic energy (activities in the atomic energy sector are governed by the Atomic
   Energy Act, 1962 and are reserved for the Government — FDI is not permitted)
9. Railway operations
   *(Note: construction and maintenance of railway infrastructure is permitted — it is
   the operation of railways that is prohibited)*

---

## Permitted Sectors — Schedule I(3)

### AGRICULTURE AND ANIMAL HUSBANDRY
| Activity | Cap | Route |
|---|---|---|
| Floriculture, horticulture, apiculture, vegetable/mushroom cultivation (controlled conditions) | 100% | Automatic |
| Development of seeds and planting material | 100% | Automatic |
| Animal husbandry including breeding | 100% | Automatic |
| Pisciculture, aquaculture, agro-allied services | 100% | Automatic |

*FDI not permitted in agricultural land.*

---

### PLANTATION (including tea)
| Activity | Cap | Route |
|---|---|---|
| Plantation sector including tea | 100% | Automatic |

**Attendant conditions:**
- Within five years of the FDI being made, the investee company must divest 26% of its
  equity to an Indian partner or to the Indian public
- Any future change in use of plantation land requires prior approval of the relevant
  State Government
- *Note: Failure to comply with the divestment condition is a FEMA violation. Build
  into transaction documents.*

---

### MINING
| Activity | Cap | Route |
|---|---|---|
| Metal and non-metal ores (including diamond, gold, silver, precious stones) | 100% | Automatic |
| Coal and lignite mining for captive consumption | 100% | Automatic |
| Titanium-bearing minerals and mineral separation | 100% | Government Approval |

**Attendant conditions:** Compliance with Mines and Minerals (Development and Regulation)
Act, 1957 and all environmental clearances. For titanium: value addition and divestment
conditions as specified in the Government approval.

---

### PETROLEUM AND NATURAL GAS
| Activity | Cap | Route |
|---|---|---|
| Exploration activities, pipelines, marketing (private sector) | 100% | Automatic |
| Petroleum refining by PSUs | 49% | Automatic |

**Attendant conditions:** For PSU refining — no disinvestment or dilution of domestic
equity in existing PSUs. Pricing and operational conditions per Ministry of Petroleum.

---

### MANUFACTURING
| Activity | Cap | Route |
|---|---|---|
| Manufacturing (general) | 100% | Automatic |

**Attendant conditions:** No sector-specific conditions for general manufacturing. Where
the manufacturing activity relates to defence items, the defence sector rules apply instead.

---

### DEFENCE
| Activity | Cap | Route |
|---|---|---|
| Defence manufacturing — up to 74% | 74% | Automatic |
| Defence manufacturing — above 74% | 100% | Government Approval (Cabinet Committee on Security) |

**Attendant conditions (all percentages):**
- Industrial licence required under the Industries (Development and Regulation) Act, 1951
- Investee company incorporated in India; management in Indian hands; majority of
  directors must be Indian nationals; Chief of Security must be an Indian national
- Investor should be an OEM or entity designated by the Ministry of Defence
- Any change in foreign ownership or control of a licensed defence company requires
  fresh Government approval
- Products must be on the Ministry of Defence approved list
- Compliance with Defence Acquisition Procedure

---

### BROADCASTING
| Activity | Cap | Route |
|---|---|---|
| FM Radio / Terrestrial Broadcasting | 26% | Government Approval |
| News and Current Affairs TV Channels (up-linking/down-linking) | 49% | Government Approval |
| Non-news TV Channels, Cable Networks, DTH — up to 49% | 49% | Automatic |
| Non-news TV Channels, Cable Networks, DTH — above 49% | 100% | Government Approval |
| Mobile TV, HITS Broadcasting | 100% | Automatic |

**Attendant conditions:** Ministry of Information & Broadcasting compliance; Programme
Code and Advertising Code; Cable TV Networks (Regulation) Act, 1995. No entity of
Pakistani origin permitted in DTH, cable networks, or news/current affairs TV channels.

---

### PRINT MEDIA
| Activity | Cap | Route |
|---|---|---|
| Newspapers and periodicals dealing with news and current affairs | 26% | Government Approval |
| Indian editions of foreign news/current affairs magazines | 26% | Government Approval |
| Scientific, technical, specialty magazines and journals | 100% | Automatic |

**Attendant conditions (news/current affairs):** FDI must be made directly into the
Indian publishing entity; at least three-fourths of the directors and all key executives
must be resident Indian citizens; compliance with Press and Registration of Books Act,
1867 and Press Council Act, 1978.

---

### CIVIL AVIATION
| Activity | Cap | Route |
|---|---|---|
| Airports — greenfield | 100% | Automatic |
| Airports — brownfield — up to 74% | 74% | Automatic |
| Airports — brownfield — above 74% | 100% | Government Approval |
| Scheduled domestic air transport — Indian carriers — up to 49% | 49% | Automatic |
| Scheduled domestic air transport — Indian carriers — above 49% | 100% | Government Approval |
| NRI investment in scheduled domestic air transport | 100% | Automatic |
| Foreign airlines investing in Indian carriers | 49% | Automatic |
| Helicopter services, non-scheduled air transport | 100% | Automatic |
| Ground handling, MRO, flying training institutes | 100% | Automatic |

**Attendant conditions:** Compliance with Aircraft Act, 1934 and Aircraft Rules, 1937;
DGCA permissions required. Foreign airlines cannot invest in Air India. No Pakistani
national or entity permitted.

---

### CONSTRUCTION DEVELOPMENT
*(townships, housing, commercial premises, hotels, hospitals)*
| Activity | Cap | Route |
|---|---|---|
| Construction development | 100% | Automatic |

**Attendant conditions:**
- Minimum capitalisation: USD 10 million for a wholly-owned subsidiary; USD 5 million
  for a joint venture — to be brought in within six months of commencing business
- Minimum built-up area: 20,000 sq. m. (5,000 sq. m. for hotels, hospitals, SEZs)
- 30% of project cost to be used for affordable housing
- Original foreign investment cannot be repatriated before project completion; exit
  permitted through secondary market sale to another non-resident, or where the project
  has received credit facilities from scheduled banks
- Three-year lock-in from date of each tranche of FDI (not applicable to hotels,
  hospitals, SEZs)
- Compliance with Real Estate (Regulation and Development) Act, 2016

*Note: FDI-linked performance conditions apply. A FOCC structured as an LLP cannot
invest in this sector.*

---

### TELECOM
| Activity | Cap | Route |
|---|---|---|
| Telecom services and infrastructure | 100% | Automatic |

**Attendant conditions:** Licence from Department of Telecommunications (DoT) required;
security clearance required; special vetting for vendors from land border countries;
compliance with Indian Telegraph Act, 1885.

---

### TRADING
| Activity | Cap | Route |
|---|---|---|
| Single Brand Retail Trading (SBRT) | 100% | Automatic |
| Multi-Brand Retail Trading (MBRT) | 51% | Government Approval |
| Cash and Carry Wholesale Trading | 100% | Automatic |

**SBRT attendant conditions:**
- Only one brand permitted; same brand sold internationally; branding must have occurred
  during manufacturing
- Above 51% FDI: mandatory 30% sourcing from India (MSMEs, village/cottage industries,
  artisans, craftsmen) from the fifth year of commencement of business
- *Note: 30% sourcing is an FDI-linked performance condition — a FOCC-LLP cannot invest
  in SBRT above 51%.*

**MBRT attendant conditions:**
- Minimum FDI of USD 100 million; at least 50% of total FDI to be invested in backend
  infrastructure within three years
- Minimum 30% of goods sourced from Indian small industries (plant and machinery
  investment not exceeding USD 2 million)
- Retail sales only through physical stores; State Government permission required
- Permitted only in cities with population above 10 lakh (2011 Census)
- *Note: Significant FDI-linked performance conditions. FOCC-LLP cannot invest here.*

---

### FINANCIAL SERVICES
| Activity | Cap | Route |
|---|---|---|
| Banks — private sector — up to 49% | 49% | Automatic |
| Banks — private sector — above 49% | 74% | Government Approval |
| Banks — public sector (other than RBI) | 20% | Government Approval |
| NBFCs (non-banking financial companies) | 100% | Automatic |
| Insurance (life, general, health, reinsurance) | 74% | Automatic |
| Pension | 49% | Automatic |
| Asset Reconstruction Companies (RBI-registered ARCs) | 100% | Automatic |
| Stock exchanges, depositories, clearing corporations | 49% | Automatic |
| Commodity exchanges | 49% | Automatic |
| Credit Information Companies | 74% | Automatic |

**Financial services — catch-all:** Financial services activities not falling under any
specific entry in Schedule I → **Government Approval required**, regardless of stake.
*Legal basis: Schedule I(3)(b)(iii), NDI Rules.*

**Investing companies:**
- Not registered as NBFC or CIC → **Government Approval required at all percentages**
- Registered as NBFC → **100% Automatic Route**
*Legal basis: Schedule I(3)(b)(v)(A) and (B), NDI Rules. "Investing company" means an
Indian company that holds only investments in other Indian companies other than as a
business: Rule 2(ab).*

**Attendant conditions:** Banks — RBI licensing, Banking Regulation Act 1949, fit and
proper criteria. Insurance — IRDAI registration, Insurance Act 1938. NBFCs — RBI
registration, applicable master directions. Pension — PFRDA registration. Commodity
exchanges — no Pakistani investment; SEBI approval required.

---

### PHARMACEUTICALS
| Activity | Cap | Route |
|---|---|---|
| Greenfield | 100% | Automatic |
| Brownfield — up to 74% | 74% | Automatic |
| Brownfield — above 74% | 100% | Government Approval |

**Attendant conditions (brownfield above 74%):** DPIIT must be satisfied that the
acquisition will not adversely affect supply of essential drugs at affordable prices;
manufacturing facilities must comply with WHO-GMP standards; compliance with Drugs and
Cosmetics Act, 1940.

*Note: Government Approval above 74% brownfield is an FDI-linked approval condition.
A FOCC-LLP cannot make a downstream investment in a brownfield pharma investee company
if the resulting stake would exceed 74%.*

---

### E-COMMERCE
| Activity | Cap | Route |
|---|---|---|
| E-commerce — marketplace model only | 100% | Automatic |

*FDI is not permitted in inventory-based e-commerce.*

**Attendant conditions:** The marketplace entity cannot directly or indirectly influence
sale price; no more than 25% of sales from one vendor or its group companies in a
financial year; marketplace cannot offer warranties on products sold on its platform; no
preferential treatment for related party vendors; no distortive cash-back arrangements
through group companies.

---

### MEDICAL DEVICES
| Activity | Cap | Route |
|---|---|---|
| Medical devices (manufacturing and services) | 100% | Automatic |

**Attendant conditions:** Compliance with Medical Devices Rules, 2017; CDSCO
registration as applicable.

---

### PRIVATE SECURITY AGENCIES
| Activity | Cap | Route |
|---|---|---|
| Up to 49% | 49% | Automatic |
| Above 49% | 74% | Government Approval |

**Attendant conditions:** Compliance with Private Security Agencies (Regulation) Act,
2005; State Government licensing.

---

### SATELLITES
| Activity | Cap | Route |
|---|---|---|
| Establishment and operation of satellites | 74% | Government Approval |
| Manufacturing of satellite and ground/user segment equipment | 100% | Automatic |

**Attendant conditions:** Department of Space and IN-SPACe approvals required; security
clearance required; compliance with Space Activities Act.

---

## Default Rule

If the investee company's sector is **not listed** in Schedule I of the NDI Rules,
**100% FDI under the Automatic Route** applies.

---

*Always verify each entry live against the NDI Rules PDF provided and conduct a web
search for any recent DPIIT press notes, clarifications, or amendments before completing
the sectoral assessment. This table reflects the NDI Rules as amended; sector entries
are subject to change by Government notification.*
