India is set to notify eased FDI rules allowing foreign companies with up to 10% Chinese shareholding to invest under the automatic route, following final clearance under FEMA.

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• The Department of Economic Affairs is expected to soon notify relaxed FDI rules under FEMA for foreign firms having up to 10 per cent Chinese equity participation.
• The Department for Promotion of Industry and Internal Trade had already issued a March Press Note allowing such investments under the automatic route across sectors.
• The final notification is pending DEA approval, which is currently completing stakeholder consultations with relevant ministries and departments.
• Inputs have been received from ministries including heavy industries, electronics and IT, and new and renewable energy for final policy fine-tuning.
• The policy change aims to balance investment inflows while maintaining scrutiny over firms linked to countries sharing land borders with India.
• India’s gross FDI inflows reached $88.3 billion during April–February FY26, showing strong investor confidence in the Indian economy.
• Net FDI also improved significantly during the same period, reflecting stronger capital retention and sustained foreign investment momentum.
• The reform is expected to streamline approvals, attract global capital, and boost investment in key manufacturing and technology-driven sectors.