Cabinet Approves Changes in FDI Policy for Countries Sharing Land Border with India

On 10^th March 2026, the Union Cabinet approved change in guidelines on investments from countries sharing land border with India.

Background

Restrictions Introduced During COVID-19

• The current regulatory framework governing investments from neighbouring countries was introduced through Press Note 3 (2020) during the COVID-19 pandemic.
• It required prior government approval for investments from countries sharing a land border with India to prevent opportunistic takeovers of vulnerable Indian firms amid economic uncertainty.
• However, the rule also unintentionally affected global private equity and venture capital funds with minor, non-controlling investors from neighbouring countries.

Major Changes Made

Definition of Beneficial ....