India woos rich foreigners to boost investment

A cyclist rides past the Illuminated Indian Defence Ministry (L), Presidential Palace (C) and Home Ministry ahead of India’s Independence Day celebrations in New Delhi © Adnan Abidi
As part of the Indian government's plan to attract more overseas funds, the cabinet has approved an ‘investor visa’ which grants residency to foreigners who make a substantial economic contribution to the country.

Foreigners investing $1.5 million over 18 months, or $3.75 million over three years, will be granted so-called permanent residency status which allows them to live in India for ten years. That can be extended for another decade if certain conditions are met.

One of the key conditions for the entrepreneurs is that their investments should result in creating at least 20 jobs for Indians every financial year.

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Investors will be permitted to buy a residential property and remain in India without registering with the police. Their spouses and children could work or study in the country legally.

“It’s very important psychologically, and I think that the announcement will attract a lot of interest and be very welcome,” Mark Runacres, a former British diplomat who now runs an executive search firm in New Delhi, told the Financial Times.

With the move, India joins countries like the United Arab Emirates, Singapore and Hong Kong, which offer an option to permanently remain in the country for those entrepreneurs who invest a certain amount of money.

Foreign direct investment into India climbed 23 percent to $55 billion in the year through March 2016. The country is ranked 130th in the World Bank's Ease of Doing Business index.

India is the world’s fastest growing major economy and needs to create about 10 million jobs a year to prevent increasing unemployment.