India Eases FDI Norms, Introduces Expedited Process for Foreign Investments

In a significant move, India has eased its Foreign Direct Investment (FDI) norms, allowing overseas companies with up to 10% Chinese shareholding to invest in the country through the automatic route. However, this relaxation does not apply to firms registered in China or other nations sharing land borders with India.

The Union Cabinet's modification to the 2020 press note now permits non-controlling LBC (Land Border Countries) ownership up to 10% under the automatic route, subject to sectoral caps and conditions. Investments will only require reporting of relevant details to the Department for Promotion of Industry and Internal Trade (DPIIT).

To expedite the process, proposals from LBCs in specified manufacturing sectors will be processed within 60 days. A new portal is being prepared to facilitate quicker filing and approvals, reflecting India's commitment to enhancing manufacturing capabilities and promoting foreign investment.