My company in Kolkata wants to receive foreign direct investment; what are the FEMA compliance requirements and sectoral caps?

Foreign direct investment is regulated by the Foreign Exchange Management Act, 1999 (FEMA) and the FEMA (Non-Debt Instruments) Rules, 2019, with sectoral caps and entry routes specified by the Department for Promotion of Industry and Internal Trade. Most sectors are under the automatic route, but sectors such as defence, telecom, and broadcasting require government approval. The company must report the FDI to the RBI through the FIRMS portal within thirty days of issuance of shares, using Form FC-GPR. The Calcutta High Court may interpret disputes regarding FEMA compliance. The West Bengal Premises Tenancy Act 1997 on stamp duty for share issuance and the West Bengal Premises Tenancy Act 1997 on company law may apply. Downstream investment and pricing guidelines must be followed. Non-compliance attracts penalties under Section 13 of FEMA, which may include confiscation and compounding proceedings before the Directorate of Enforcement.