The government is considering tripling the CCEA approval threshold for large foreign direct investment proposals.
It is also examining simpler downstream investment rules to improve ease of doing business and attract more overseas capital.
Highlights
- CCEA approval threshold for FDI proposals may rise to ₹15,000 crore from ₹5,000 crore.
- The existing ₹5,000 crore limit has remained unchanged since November 2015.
- FDI proposals below the threshold are decided by the respective line ministries.
- The government is also considering easing rules for downstream or indirect foreign investments.
- Certain indirect investments may not require fresh approval if the upstream company already has government clearance.
- India received more than $1.16 trillion in foreign investment between April 2000 and March 2026.
The central government is considering a proposal to significantly increase the threshold for foreign direct investment proposals that require approval from the Cabinet Committee on Economic Affairs, or CCEA.
According to the report, the government may raise the threshold to ₹15,000 crore from the existing ₹5,000 crore as part of efforts to improve India’s investment environment and ease the approval process for large overseas investments.
Under the existing foreign direct investment policy, proposals involving a total foreign equity inflow of more than ₹5,000 crore need to be placed before the CCEA for approval. Proposals below this level are handled by the respective line ministries.
The current ₹5,000 crore threshold has remained unchanged since November 2015.
Sources cited in the report said that prevailing economic conditions, inflation and the growing size of investments over the years have created a need to review the existing limit. The move is also expected to support the government’s broader objective of improving ease of doing business.
A committee of secretaries has also suggested an upward revision of the CCEA approval threshold for foreign investment proposals that fall under the government approval route. However, the proposal is currently at the discussion stage.
Apart from the threshold revision, the government is considering another significant change involving downstream foreign investment rules.
Under the proposal, an Indian company receiving indirect foreign investment may be exempted from seeking fresh government approval if the upstream domestic company making the investment has already obtained the necessary clearance.
At present, prior government approval is required for downstream or indirect foreign investment in sectors covered under the government approval route and in cases involving investments from countries that share a land border with India.
The proposed changes are aimed at making the approval system less cumbersome while encouraging greater foreign capital inflows and supporting job creation.
India has received more than $1.16 trillion in foreign investment between April 2000 and March 2026. Major sources of investment include Mauritius, Singapore, the United States, the Netherlands, Japan, the United Kingdom and the UAE.
