DPIIT Revises FDI Rules to Ease Investment Norms for Border-Sharing Countries

The Department for Promotion of Industry and Internal Trade (DPIIT) has amended foreign direct investment (FDI) norms to ease restrictions for investors from countries sharing land borders with India, including China. Investors can now hold up to 10% non-controlling stakes under the automatic route, subject to sectoral caps, while government approval remains mandatory if beneficial ownership changes or exceeds this limit. The definition of 'beneficial owner' aligns with the Prevention of Money Laundering Act. These changes follow a cabinet decision to update Press Note 3 (2020) aimed at preventing opportunistic takeovers during the pandemic.