Export-only inventory-based e-commerce is permitted for Indian-made goods, removing applicable business-to-consumer and inventory-model restrictions.
Foreign direct investment policy permits an e-commerce entity to use an inventory-based e-commerce model exclusively to export goods or products manufactured or produced in India. Such exports must comply with the applicable Foreign Trade Policy, Handbook of Procedures, and foreign-exchange regulations governing exports. Existing restrictions on business-to-consumer and inventory-based e-commerce do not apply to this export-only model from the date of the relevant foreign-exchange notification.

Border-country foreign investment restrictions require government approval for covered investors, beneficial ownership changes, and prescribed reporting obligations.
Foreign direct investment from countries sharing a land border with India requires the Government route where the investor or beneficial owner falls within the prescribed restriction. A subsequent direct or indirect ownership transfer causing beneficial ownership to fall within that restriction requires prior Government approval. Beneficial ownership may arise through ownership above applicable thresholds, control of the investor entity, or ultimate effective control over the Indian investee entity. Other covered investments not requiring approval are subject to prescribed reporting, alongside sectoral caps, entry routes, and attendant conditions.

Foreign investment in insurance permits full automatic-route participation, subject to regulatory verification, governance conditions, licensing and disclosure obligations.
Foreign direct investment in Indian insurance companies and insurance intermediaries is permitted up to 100 per cent under the Automatic Route, subject to insurance regulatory verification, licensing, applicable insurance law and foreign-investment rules. Insurance companies with foreign investment must maintain a resident Indian citizen in specified senior leadership roles. Foreign-majority-owned intermediaries must be limited companies, maintain prescribed resident Indian leadership, bring skills and disclose specified related-entity payments. Foreign investment in the Life Insurance Corporation of India remains capped at 20 per cent under the Automatic Route.

Security Manual for Licensed Defence Industries requires licence holders to implement graded physical, personnel and cyber safeguards before production.
The SMLDI 2025 mandates that all companies holding Industrial Licences must comply with the Security Manual's provisions before commencing production; it designates CEO/Head as overall responsible and requires appointment and vetting of a CCSO and CISO, prescribes graded security controls by product category, detailed physical, personnel, material and information security measures, cyber security requirements (aligned with ISO 27001), reporting and audit obligations, and enforcement including actions under relevant statutes and possible licence suspension.

Bonus share issuance to non-resident shareholders permitted where shareholding proportions remain unchanged under FDI restrictions.
An Indian company engaged in a sector prohibited for FDI may issue bonus shares to pre-existing non-resident shareholder(s) provided that the shareholding pattern of the pre-existing non-resident shareholder(s) does not change as a consequence of the issuance. Issuance must comply with applicable laws, rules, regulations and guidelines and the clarification will be effective from the date of the relevant FEMA notifications.

IEM eligibility revised: higher investment and turnover thresholds required for large-scale enterprises; applications via G2B portal.
Revisions raise the eligibility criteria for Industrial Entrepreneur Memorandum (IEM) acknowledgment by increasing investment in plant and machinery and annual turnover thresholds, effective 1 April 2025. IEM acknowledgment applies to large-scale industries not subject to compulsory industrial licensing and to enterprises whose investment or turnover exceed the revised MSME limits. Eligible enterprises should apply for IEM acknowledgment through the G2B portal in accordance with the updated criteria.

FDI caps in space sector updated: automatic entry up to specified thresholds; above that requires government route under space guidelines.
The Press Note amends FDI norms for the space sector by specifying sectoral caps and entry routes: satellite manufacture/operation, satellite data products, and ground/user segments permit FDI via automatic route up to a set threshold with higher proposals routed to government approval; launch vehicles and spaceports permit automatic entry up to a lower threshold with higher investments on government route; manufacturing of components/subsystems is permitted fully under the automatic route. Investee entities are subject to sectoral guidelines issued by the space authority and the changes take effect after the FEMA notification.

Industrial license validity extended to fifteen years with a possible three year extension; automatic lapse if production not commenced.
The Press Note increases industrial licence initial validity to fifteen years with a possible discretionary three year extension, and provides that licences where commercial production has not commenced within the maximum aggregate period shall be treated as automatically lapsed. Extensions are to be processed by the Administrative Ministry/Explosive Section (DPIIT) and may be approved by the Additional Secretary/Joint Secretary without referral to the Licensing Committee, subject to conditions on timing, unchanged licence status, government comments, land tenure, completed construction, and installed plant and machinery; transfers, suspensions or cancellations bar extension.

Foreign investment in LIC permitted via automatic route subject to statutory compliance and governance conditions.
The FDI Policy amendments permit foreign investment in the Life Insurance Corporation of India via the automatic route subject to specified statutory compliance and governance conditions; amend core definitions of Capital, Convertible Note, Foreign Investment, Indian Company, Share Based Employee Benefits and Subsidiary; clarify Real Estate Business exclusions; bifurcate "Other Conditions" into insurer/intermediary and LIC specific provisions including resident Indian majorities in board and key management, regulatory verification, pricing guidance for increases, and ESOP/share benefit reporting and approval requirements.

Foreign investment in telecom services allowed via automatic route but subject to licensing and specified prior approval requirements.
Telecom services are authorised to receive 100% FDI under the automatic route for listed telecom activities, including Infrastructure Provider Category I, but investors and licensees must comply with licensing, security and other terms specified by the telecom regulator. Notwithstanding the automatic route, investments falling within the FDI policy's prior approval criteria will continue to require government approval; the amendment is effective immediately.

Foreign investment via automatic route allowed where strategic disinvestment in principle approval exists for PSU petroleum refining projects
The FDI policy amendment creates a conditional exception for petroleum-sector PSUs: while private sector exploration, marketing, pipelines and refining remain allowed under the automatic route and PSU refining was previously subject to a lower foreign equity cap, foreign investment up to full foreign equity under the automatic route is permitted where an in principle approval for strategic disinvestment of a PSU has been granted; effectivity follows issuance of the applicable foreign exchange notification.

Foreign investment caps in insurance set under automatic route with residency, governance and regulator verification requirements.
The FDI regime for the insurance sector prescribes fixed foreign equity ceilings with entry via the automatic route subject to IRDAI verification, compliance with the Insurance Act and licensing, RBI pricing guidelines for increases, and FEMA/SEBI rules for portfolio investment. Insurers with foreign investment must have a majority of resident Indian directors and key management personnel and meet the Indian Insurance Companies (Foreign Investment) Rules, 2015. Insurance intermediaries have separate full foreign equity allowance but face incorporation, senior-residency, dividend repatriation, payment limitation, disclosure and board/composition requirements. Bank-promoted insurers and related applications require RBI consultation with IRDAI.

Non-repatriation investments by NRIs treated as domestic, excluded from indirect foreign investment computation under FDI rules.
Investments by Indian companies owned and controlled by NRIs made on a non-repatriation basis are treated as domestic investments at par with resident investments and shall not be considered in the calculation of indirect foreign investment for downstream investment purposes under the consolidated FDI Policy.

Foreign Direct Investment policy: sectoral caps and automatic or government routes set entry, conditionalities and reporting obligations.
The Circular consolidates FDI policy and defines eligible investors, investee entities and instruments; prescribes two entry routes-automatic and government-with sectoral caps, conditionalities and prohibited activities; governs issuance, transfer and conversion of capital instruments with pricing and reporting rules; sets rules for downstream and indirect foreign investment and requires notification to RBI and compliance with FEMA/RBI/SEBI requirements; and establishes procedural governance, competent authorities and monitoring mechanisms for approvals and compliance.

Foreign investment cap in defence raised under automatic route; government approval required beyond higher threshold, with security review.
The policy raises the automatic-route foreign equity ceiling for the defence industry and retains government approval beyond the new ceiling where access to modern technology or other specified reasons exist. Licence applications remain subject to inter-ministerial consultation; foreign investment requires security clearance and may be reviewed on national security grounds. Companies not holding an industrial licence must file a mandatory declaration with the Ministry of Defence within thirty days if foreign infusion alters ownership up to the lower threshold, while proposals to increase FDI beyond that lower threshold require government approval. Investee entities must ensure in country design, development, manufacturing, maintenance and life cycle support capabilities.

Foreign investment from neighbouring-border countries now subject to government approval to curb opportunistic takeovers during pandemic period.
The FDI policy amendment requires that investments by entities of countries sharing a land border with India, or where the beneficial owner is situated in or is a citizen of such a country, be routed only through the Government route; the Pakistan-specific Government route restriction remains except for certain prohibited sectors. Additionally, any transfer of existing or future FDI that causes beneficial ownership to fall within this restriction will likewise require Government approval. The change is effective from the date of the relevant foreign exchange notification.

FDI caps in scheduled air services limited under automatic route; larger foreign airline investment requires government approval.
FDI in Civil Aviation allows automatic foreign investment for airports and specified ancillary services; scheduled air transport remains subject to an automatic route up to a prescribed limit with higher participation requiring Government approval. Foreign airlines may invest in cargo, helicopter and seaplane operators and in air transport companies up to the prescribed ceiling subject to Government approval, SEBI compliance, Indian registration and control requirements, security clearances for foreign nationals, and clearances for imported technical equipment; Air India remains subject to the prescribed cap and Aircraft Rules compliance.

Foreign investment caps in insurance updated; equity limits and control conditions govern insurers and intermediaries under automatic route.
The Press Note revises the insurance-sector FDI framework: Indian insurance companies are limited to forty-nine percent total foreign investment, allowed via the automatic route subject to IRDAI verification, Insurance Act compliance and RBI pricing rules for increases; foreign portfolio investment follows FEMA and SEBI FPI regulations. Intermediaries (brokers, consultants, corporate agents, TPAs, surveyors and loss assessors) may have full foreign equity under the automatic route but must satisfy corporate form, resident Indian senior officer, dividend repatriation permission, disclosure and board/management composition requirements prescribed by regulators.

Contract manufacturing treated as manufacturing under FDI policy, permitting wholesale, retail and e commerce sales subject to compliance.
Contract manufacturing by a third party under a legally tenable contract is treated as manufacturing for FDI purposes, making the principal with foreign investment a manufacturing entity; such principals may sell products via wholesale, retail and e commerce without separate government approval, subject to compliance with applicable FDI policy conditions and FEMA requirements, for which the manufacturing entity remains responsible.

Foreign Direct Investment policy revised: automatic manufacturing and single brand retail rules, sourcing obligations, and digital news streaming controls.
FDI policy amendments permit automatic route foreign investment for coal and lignite mining (including sale and defined associated processing infrastructure) subject to mining statutes; confirm manufacturing under automatic route including contract manufacturing and unrestricted sale via wholesale, retail and e commerce; set Single Brand Retail Trading under automatic route with single brand, branded at manufacture requirements, a local sourcing obligation for majority foreign investment with detailed counting and averaging rules, and brick and mortar timing for online retail; and require government approval for digital media news streaming. Effective from FEMA notification.