The net outward foreign direct investment went up from $9.1 billion in 2017-18 to $12.6 billion in 2018-19 and moved further north to $13 billion in 2019-20.
The Reserve Bank of India (RBI) will rationalise regulations for overseas direct investment (ODI) in order to make them simpler and more principles-based.
The strategy for 2020-21 is to focus on consolidating and carrying forward all the initiatives which were undertaken in the previous year.
Also, the emphasis will remain in ensuring that the Foreign Exchange Management Act (FEMA) operating framework is in sync with the needs of the evolving macroeconomic environment.
The regulator also intends to introduce late submission fee for delayed reporting of overseas direct investments (ODI) by Indian parties and resident Indians.
Outward direct investment by Indian entities remained robust as they continued to expand their overseas business operations.
The net outward foreign direct investment (FDI) went up from $9.1 billion in 2017-18 to $12.6 billion in 2018-19 and moved further north to $13 billion in 2019-20, according to the annual report.
Outward FDI was mainly in the form of equity and loans to subsidiaries/affiliated enterprises, primarily in Singapore, the US, the UK, Mauritius, Switzerland and the Netherlands.
These countries accounted for 75 per cent of the total overseas investments during the period.
Most of these investments were made in the business services, manufacturing and restaurants and hotels sectors.
The rationalisation of provisions on foreign exchange and currency under Foreign Exchange Management Regulations, 2015, would cover repatriation and surrender of foreign exchange, possession, and retention of foreign currency.
These provisions, which are currently covered in four different notifications under the FEMA, would be unified under a single regulation, the RBI said in its annual report for 2019-20.
The broad policy approach has been re-oriented towards a principles-based regulatory framework.
The emphasis has been on market surveillance and intelligence to ensure that financial markets operate in a fair, efficient and transparent manner.
Photograph: Kham/Reuters
