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India Eases FDI Norms For Firms With Limited Chinese Ownership

India has relaxed foreign direct investment (FDI) rules for overseas entities with up to 10% Chinese Mainland or Hong Kong shareholding, allowing such investments to proceed through the automatic route from 1 May 2026. The investing entity, however, must not be registered in China, Hong Kong or any country sharing a land border with India, and investment details must still be reported to DPIIT. The changes amend the Press Note 3 framework and are aimed at supporting manufacturing growth in sectors such as capital goods, electronics and solar supply chains. The government has also introduced a 60-day approval timeline for select manufacturing-sector investment proposals involving neighbouring countries.


The changes amend the Press Note 3 framework and are aimed at supporting manufacturing growth in sectors such as capital goods, electronics and solar supply chains. The government has also introduced a 60-day approval timeline for select manufacturing-sector investment proposals involving neighbouring countries.

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