Centre seeks inputs over FDI dip worries

Govt plans to address issues that hinder foreign investments

- Sneha Shah & Ravi Dutta Mishra

Concerned about the decline in foreign direct investment (FDI) ahead of next year’s national elections, government officials met with alternative investment funds, startup founders and fund managers last week to identify and iron out operational challenges impeding capital inflows into India, people present in these meetings said.

During the meeting with the department for promotion of industry and internal trade (DPIIT) officials, industry participants highlighted tax authorities’ reluctance to understand the valuation and revenue mismatch in high-growth startups. “Authorities are questioning founders on how they are able to justify their lofty valuations with low revenues and often suspect there is a tax theft," said a person who was present at the meeting.