As per the extant norms, up to 26 % FDI is permissible in pension sector through automatic route. However, FDI up to 49% is permissible in pension sector if approval from Govt. is obtained.
To attract more foreign Investment in India, the Govt. has allowed up to 49% FDI in Pension Sector under automatic route. Thus, now approval from Govt. is not required for 49% FDI in Pension Sector. However, it is subject to the condition that foreign investments should be brought in the form of equity shares or preference shares or convertible debentures or warrants of the Pension Fund Regulatory and Development Authority (PFRDA) Act, 2013. Further, an entity should obtain necessary registration from the PFRDA and comply with other requirements of the PFRDA Act, 2013 and Rules and Regulations framed there under.