Archive · 28 Aug 2026
Goyal Proposes Easier FDI Rules and Higher Approval Thresholds
India wants to make it easier for foreign companies to invest in the country.
Minister Piyush Goyal said the government is open to ideas from businesses.
One proposal would simplify how companies with foreign ownership invest in other Indian companies.
Another would make identity and business checks, called KYC, faster.
India is also considering accepting approvals from regulators in other countries through mutual agreements.
The government may raise the value of investments that need approval from the Cabinet Committee on Economic Affairs from Rs 5,000 crore to Rs 15,000 crore.
Some people are asking India to join a large Pacific trade group called the CPTPP.
India has not yet decided whether to join and is concentrating on separate trade agreements with individual countries and groups.
Commerce Minister Piyush Goyal said India has substantial scope to improve foreign-investment processes, procedures and policies.
The government is considering easier downstream investments by companies that already have foreign equity participation.
Proposals include faster KYC procedures, mutual recognition agreements with overseas regulators and raising the CCEA approval threshold to Rs 15,000 crore.
Goyal said industry discussions in Japan generated new ideas, while investors have described some compliance requirements as cumbersome.
India is focusing on bilateral trade agreements and has not decided whether to consider joining the 12-member CPTPP.
- Who
- Commerce and Industry Minister Piyush Goyal, the Indian government and industry representatives.
- What
- India is considering changes to make foreign direct investment processes and downstream investments easier, while reviewing its trade-policy options.
- When
- The proposals were discussed on Thursday, at the end of Goyal’s visit to Japan.
- Where
- The discussions included Goyal’s engagements in Japan and concern foreign investment into India.
- Why
- To make FDI approvals and compliance more efficient and respond to ideas raised by industry and overseas regulators.
Investment Reform Advocates
Cautious Policy Position
Simplifying FDI procedures
Investment Reform Advocates
Industry has raised concerns that compliance requirements are cumbersome and supports faster KYC checks, simpler downstream-investment rules and recognition of foreign regulatory approvals.
Cautious Policy Position
The government is open to new ideas but must preserve sectoral caps, entry routes and approval requirements for sensitive activities.
Joining the CPTPP
Investment Reform Advocates
Goyal said many people are asking India to consider joining the 12-member trade bloc, which includes Japan, Australia, Canada, the United Kingdom and New Zealand.
Cautious Policy Position
India has not yet applied its mind to joining and is currently focusing on bilateral trade agreements.
- Current FDI framework
- India permits 100% FDI through the automatic route in most sectors, while sensitive sectors retain restrictions or require government approval.
- Downstream investment proposal
- The government is considering making it easier for foreign-owned or foreign-controlled companies to invest in downstream companies.
- Current downstream treatment
- The entire investment by a foreign-owned or controlled company is currently counted toward the target company’s sectoral foreign-investment cap.
- KYC and regulatory approvals
- Faster Know Your Customer procedures and mutual recognition agreements with foreign regulators are being considered.
- Approval threshold
- The proposed threshold for proposals requiring Cabinet Committee on Economic Affairs approval would rise to Rs 15,000 crore from Rs 5,000 crore.
- CPTPP position
- The Comprehensive and Progressive Agreement for Trans-Pacific Partnership has 12 members; India is not a member and has not decided whether to apply.
- Trade negotiations
- India is negotiating or reviewing trade agreements involving Israel, Chile, Peru, Canada, the Gulf Cooperation Council, the Eurasian Economic Union, the Southern African Customs Union, Mexico and Mercosur.