<h1>Government Raises FDI Limits in Defense and Insurance to 49%, Eases Rules for Smart Cities and Manufacturing.</h1> The government allows up to 100% Foreign Direct Investment (FDI) in most sectors under the automatic route, subject to laws and regulations. FDI is prohibited in sectors like gambling, lotteries, and real estate. The Finance Minister announced plans to raise FDI caps in defense manufacturing and insurance from 26% to 49%, maintaining Indian management control. For smart city development, FDI requirements are reduced, and projects focusing on affordable housing are exempt from certain conditions. Manufacturing units can sell via retail and e-commerce without additional approvals. This policy aims to boost job creation and domestic manufacturing.