Insurance – Management Control / Foreign Direct Investment (FDI) Cap:
In the immediate aftermath of the increase of FDI for Insurance to 49%, the Government of India released Guidelines to implement the Insurance Act that interpreted the statutory definition of “ownership and control” of a jointly-held company to remain with Indian residents or Indian companies. The guidelines apply retroactively to all existing joint ventures including those who do not intend to increase their investment beyond 26% and/or will remain at their current investment level.Many of the existing joint venture partnerships were modified to comply with the new requirements. The retroactive application of guidelines to well-established arrangements runs counter to the Government of India’s broad commitment to refrain from retroactive legislation and rules, and the other steps it has taken to build a transparent and clear regulatory framework to encourage growth and long-term investment in Indian insurance.
The Committee has advocated that the Government of India should immediately suspend any further violations of investor rights and establish a dialogue with U.S. and other trade partners to review options for providing a fair and equitable resolution of the harm caused by forced retroactive application of discriminatory regulations that harmed American insurers in India. The Committee has argued that the remedy to resolve this issue holistically is to amend the Indian Insurance Law to allow foreign insurers the ability to own 100% of an Indian insurance company.
Taxation — Software Services Refund Claim
The Government of India has recently classified services rendered by software and IT/ITeS entities as exports and tax officers have challenged companies’ ability to claim a refund on the service taxes paid on vendor invoices. These practices by tax officers have had a negative impact on the continued growth of this industry in India. The Committee is advocating the Central Board of Excise and Customs to review the issue and provide detailed guidelines in this regard to state that: data/ instructions received via emails/ electronic media should not be considered as (intangible) goods, that Rule 3 of the Place of Supply Rules should apply to software/ IT/ ITeS companies for examining their eligibility of exports; and that the notices issued until date on this issue should stand quashed.
Real Estate – Realizing the Potential of Real Estate Regulation Act (RERA)
Affordable housing for all Indian citizens is a key goal for Prime Minister Modi’s vision for India in the decades to come. The Committee works on policy reforms such as the implementation of the Real Estate Regulation Act (RERA) to remove barriers related to infrastructure, land acquisition, costs, and local and state level approval processes. The Committee works on promoting quick resolution of cases under RERA.

Mandatory Listing Requirement for Insurance Providers
The Committee successfully advocated for the reversal of a proposal mandating that all insurance companies operating in India for ten years or more be required to be publicly listed in an effort to promote better corporate governance and transparency.Software Services IT Refund Claim
The Committee successfully raised the IT/ITeS Refund Claim issue with tax authorities who have taken it under advisement to resolve more quickly and issue clarification. The Committee continues to work on the issue with its members to monitor progress.
GST Tax Levels
The Committee worked with various sectors to advocate for tax levels under the GST law in front of the committee. These include financial services, energy, life sciences.

Nileema Pargaonker leads the U.S.-India Business Council’s Financial Services Committee. In this capacity, she works with both financial service providers and policy makers to build a dynamic financial services sector in India.

Pargaonker previously served at the Financial Industry Regulatory Authority (formerly NASD) (FINRA), where she spent more than 16 years as a regulator in a number of divisions, including Corporate Finance and Enforcement. For ten of those years, she was a Director in FINRA’s International Department, where she led relationships with foreign regulators in Europe and Asia. In this role, she delivered technical assistance to emerging markets on regulatory rule reform, oversight programs, and policy development.

Nileema earned her Bachelor’s degree from the University of Chicago, a Master’s in South Asian Studies from the University of Wisconsin-Madison, and a JD/MA (International Law) from American University — Washington College of Law.

For more information, please contact Nileema Pargaonker.