India eases FDI rules to allow limited Chinese participation in manufacturing

INDIA has approved changes to its foreign direct investment (FDI) framework that will allow investments from countries sharing land borders with India in selected manufacturing sectors, including electronic components, capital goods and solar cells.

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The changes, approved by the Indian cabinet, are expected to ease restrictions that had effectively limited Chinese investment since tighter controls were introduced in 2020.

Under the revised rules, investments from these neighbouring countries will be processed through an expedited approval process, with applications expected to be reviewed within 60 days, provided Indian shareholders retain ownership control of the companies.