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FDI Routes in India

Automatic vs. Government (Approval) Route

India's FDI policy classifies inflows into two routes based on sector sensitivity and, since 2020, on the investor's country of origin/beneficial ownership.

Key details
  • Automatic route: no prior approval needed from the government or RBI; investor only needs to notify the RBI within a specified period after the investment.
  • Government/approval route: requires clearance from the concerned administrative ministry/department via the Foreign Investment Facilitation Portal (FIFP), routed through DPIIT.
  • FDI policy is governed under FEMA, 1999 (Foreign Exchange Management Act) — specifically the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 — with DPIIT issuing periodic "Press Notes" (technically now "Press Notes" continue as the amendment mechanism despite the consolidated FDI policy circular being discontinued).
  • The 2026 revision reportedly sets a threshold of up to 10% non-controlling shareholding by China/Hong Kong-linked entities for automatic-route eligibility, while retaining approval requirements for entities incorporated in or beneficially owned from China, Hong Kong, Pakistan, Bangladesh, Nepal, Bhutan, Myanmar, and Afghanistan.
In the news

● Tracked since February 27, 2026 · last seen August 21, 2026 · updates as the daily brief publishes

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