Liberalisation Of Technology Imports In India

In the last one year the Reserve Bank of India (RBI) granted permission under the automatic approval scheme, to about 60 per cent of all the technology import licences in India. The government in the same period approved about 341 cases of technology transfer, of which only 15 provided for lump-sum know-how fees above US dollars 2 million.

The automatic route supervised by the RBI permits a maximum lump-sum know-how fee of US dollars 2 million, royalty payments of 5 per cent on domestic sales and 8 per cent on export sales. On 4th September 1998, the government with a view to enhance the competitive ability of Indian industry, has announced that henceforth these limitations would not apply incase of technology imports in projects assessed and funded by Financial Institutions (FI's) and projects of central and public sector undertakings (PSU's).