Foreign direct investment into micro and small enterprises allowed subject to sectoral caps and entry route compliance. FDI into Micro and Small Enterprises is permitted subject to sectoral equity caps, entry routes and applicable sectoral regulations following redefinition of MSEs by investment in plant and machinery/equipment; Press Note 18 (1997) is modified accordingly. Industrial undertakings not qualifying as MSEs that manufacture items reserved for MSEs require an Industrial Licence, must satisfy licensing conditions including an export obligation on new or additional production from commercial commencement, and need prior government approval where foreign equity exceeds the automatic entry threshold.