The decision was taken at a Union Cabinet meeting chaired by Prime Minister Narendra Modi. Sources revealed that Press Note 3 of 2020 has been amended.
Under the earlier rule, foreign companies with shareholders from these countries needed mandatory government approval to invest in any sector in India.
Countries that share land borders with India are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan.
China ranks 23rd with a 0.32% share, or $2.51 billion, of the total FDI equity inflows reported in India from April 2000 to December 2025.
Relations between India and China declined after the clash in the Galwan Valley in June 2020. The incident marked the most serious military conflict between the two sides in decades.
After the tensions, India banned more than 200 Chinese mobile applications, including TikTok, WeChat and Alibaba’s UC Browser.
Although India has received limited FDI from China, trade between the two countries has increased.
China is India’s second-largest trading partner.
In 2024–25, India’s exports to China fell 14.5% to $14.25 billion from $16.66 billion in 2023–24.
Imports from China rose 11.52% in 2024–25 to $113.45 billion from $101.73 billion in 2023–24.
The trade deficit widened to $99.2 billion in 2024–25 from $85 billion in 2023–24.
During April–January 2025–26, India’s exports to China rose 38.37% to $15.88 billion, while imports increased 13.82% to $108.18 billion.
The trade deficit stood at $92.3 billion.
(Edited by : Vivek Dubey)
First Published: Mar 10, 2026 3:04 PM IST
