India Set to Ease FDI Rules for Foreign Companies with Chinese Stake
DEA notice awaited on easing FDI rules for foreign cos with up to 10% in China firms
The Economic Times
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India is preparing to ease foreign direct investment (FDI) regulations for overseas companies with up to 10% stake in Chinese firms. The notification from the Department of Economic Affairs is pending, and the changes aim to bolster FDI, which has already reached $88 billion in FY26.
- 01The Department of Economic Affairs is set to notify changes in FDI rules for foreign companies with up to 10% Chinese stake.
- 02Total FDI in India reached $88 billion during April-February FY26, with expectations to hit $90 billion by the end of the fiscal year.
- 03The changes will allow eligible foreign companies to invest in India under the automatic route across various sectors.
- 04DPIIT is working on expediting applications in specific sub-sectors, aiming for a processing time of 60 days.
- 05China attracted $116 billion in FDI in FY26, while the US received $300 billion.
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The Indian government is on the verge of easing foreign direct investment (FDI) regulations for overseas companies holding up to 10% stake in Chinese firms. This change, which is pending notification from the Department of Economic Affairs (DEA), is expected to facilitate investments in India under the automatic route across various sectors. The Department for Promotion of Industry and Internal Trade (DPIIT) had previously announced these changes in March, aiming to attract more foreign investment from countries sharing a land border with India. DPIIT joint secretary Jai Prakash Shivahare noted that the DEA is currently conducting stakeholder consultations to finalize the notification under the Foreign Exchange Management Act (FEMA). As of now, total FDI in India has crossed $88 billion from April to February in FY26 and is projected to reach $90 billion by the fiscal year's end. This growth is attributed to various government reforms and free trade agreements. In comparison, China attracted $116 billion in FDI during the same period, while the US received $300 billion.
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The easing of FDI rules is expected to attract more foreign investments into India, potentially leading to job creation and economic growth.
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