In exercise of the powers conferred by clauses (aa) and (ab) of sub-section (2) of section 46 of the Foreign Exchange Management Act, 1999, the Central Government amended the Foreign Exchange Management (Non-debt Instruments) Rules, 2019by which changes in the Foreign Direct Investment (FDI) policy, 2017 , which made prior approval of the government mandatory for foreign investments from countries that share border with India, to prevent opportunistic takeover of domestic firms amid COVID-19 pandemic under the under Foreign Exchange Management Act (FEMA), 1999. But the above decision will take effect from the date of FEMA notification as a necessary amendment to Rule 6 of FEMA (non-debt instruments) Rules, 2019 (NDI Rules) was awaited. Now, In exercise of the powers conferred by clauses (aa) and (ab) of sub-section (2) of section 46 of the Foreign Exchange Management Act, 1999, the Central Government amended the Foreign Exchange Management (Non-debt Instruments) Rules, 2019by which the above mentioned changes has come into effect. About FEMA Act, 1999: Passed in 1999, FEMA Act, 1999 replaced the Foreign Exchange Regulation Act (FERA), 1973 by which offences related to foreign exchange were categorized as civil offenses. Its purpose is to consolidate and amend the law relating to foreign exchange for facilitating external trade and payments in an orderly manner and also to develop foreign exchange market in India.
