Foreign Direct Investment (FDI) Policy: Union Cabinet eases norms for bordering countries

Key facts

• The Union Cabinet, chaired by Prime Minister (PM) Narendra Modi, approved the easing of FDI norms for all countries sharing land borders with India.
• The decision involves the amendment of Press Note 3 of 2020, which previously mandated prior government approval for investments from bordering nations in any sector.
• The target countries sharing land borders with India include China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar, and Afghanistan.
• China currently ranks 23rd in India's FDI equity inflow with a 0.32 per cent share, totalling 2.51 billion United States Dollar (USD) from April 2000 to December 2025.
• In the 2024-25 fiscal year, India's exports to China were 14.25 billion USD and imports were 113.45 billion USD, resulting in a trade deficit of 99.2 billion USD.
• During the April-January 2025-26 period, India's exports to China rose to 15.88 billion USD, while imports reached 108.18 billion USD.
• Following military tensions in June 2020, India banned over 200 Chinese mobile apps, including TikTok, WeChat, and Alibaba's UC browser.