During the first phase, between March 2005 and March 2009, foreign banks wishing to establish presence in India for the first time could either choose to operate through branches or set up 100 per cent wholly owned subsidiaries (WOS), following the one-mode presence criterion.
For new and existing foreign banks, it is proposed to go beyond the existing WTO commitment of 12 branches in a year. During this phase, permission for acquisition of shareholding in Indian private sector banks by eligible foreign banks will be limited to banks identified by the Reserve Bank for restructuring.