Kamal Ghorui
The government’s move to relax foreign direct investment rules for China and other nations sharing land borders with India has drawn support from experts, who say the step attempts to strike a balance between attracting capital and protecting strategic interests. They also noted that the proposal for a 60-day fast-track approval window for investments in selected sectors could provide greater predictability to investors, reported PTI.Neha Aggarwal, Partner at Deloitte India, said clearer norms on beneficial ownership bring long-awaited certainty to India’s FDI framework. “With foreign investment moderating in recent months, a 60-day approval timeline strikes a pragmatic balance between attracting capital and safeguarding strategic interests, while enabling supply-chain integration and access to advanced technologies,” she said.Shardul S Shroff, Executive Chairman of Shardul Amarchand Mangaldas & Co, said the proposed expedited route for investments in sectors such as manufacturing and electronics components is a positive step, though its scope may remain limited as majority ownership and control must stay with domestic entities.“Given this stringent requirement, the expedited route may have limited applicability,” Shroff said, PTI quoted.Rudra Kumar Pandey, Partner at the firm, said allowing investments of up to 10 per cent without prior government approval introduces a practical threshold within the Press Note 3 regime. “By ensuring the exemption is available only where the investing entity is not controlled by persons from land-bordering countries, minority investments up to 10 per cent can proceed more smoothly while retaining safeguards around control ownership,” he said.Think tank GTRI said easing restrictions could open space for cross-border investments, but the scale of manufacturing growth in India will depend on wider economic factors. Founder Ajay Srivastava said the policy should be seen as an opportunity to attract deeper manufacturing investments over time. “The policy change is best seen as an opportunity for India to attract more substantial manufacturing investment over time. To realise this potential, India must further strengthen its competitiveness by lowering the cost of manufacturing,” he said.Rahul Turki, Partner and Global Value Chain Ecosystem Leader at Grant Thornton Bharat, said the decision could ease hurdles for global private equity and venture capital funds with minority stakes. “From an investment perspective, this move could unlock capital flows into startups, deep-tech ventures, and manufacturing value chains such as electronics components and solar supply chains,” he said.Krishan Arora, Partner and Leader, Indirect Tax and India Investment Advisory at Grant Thornton Bharat, added that the revised guidelines could facilitate greater trade with neighbouring countries such as China and Bangladesh, while promoting ease of doing business, strengthening manufacturing in sectors like electronics and solar, and attracting higher inbound investment
