<h1>Domestic sourcing requirement mandates local procurement to qualify for elevated foreign investment in retail.</h1> Amendments require companies receiving significant FDI in single brand retail to source a specified share of purchased goods from India-preferably MSMEs and artisans-self certify procurement which is subject to statutory auditor verification, measured as a five year average from the year of first FDI tranche and thereafter annually; for multi brand retail FDI, a mandatory procurement share of manufactured/processed products must be sourced from Indian small industries defined by an installation time investment ceiling, with disqualification if that valuation is later exceeded, and the same averaging and annual compliance schedule applies.