In the ever-evolving landscape of India's Foreign Direct Investment (FDI) policy, certain terms and classifications have undergone significant transformations over the years. One such term that has virtually disappeared from official documentation is "trading for exports," which was once explicitly mentioned in earlier policy frameworks and subsequently omitted resulting in it being no longer permissible under the prevailing regulatory regime.
The chronology of this shift reveals much about the streamlining and consolidation of India's FDI policy over the past two decades.
In the mid 2000s, government publications differentiated various types of trading activities. Press Note 4 (2006) clearly listed "cash & carry wholesale trading and export trading" as activities where 100% FDI was permitted under the automatic route (Entry 2 (a) (vii)). The annex to this Press Note reiterated this position by listing these activities under the trading sector.
