New Delhi: The government is considering raising the threshold for foreign direct investment (FDI) proposals requiring Cabinet Committee on Economic Affairs (CCEA) approval to ₹15,000 crore from the existing ₹5,000 crore, according to sources.
The proposed move is aimed at simplifying the approval process and improving India’s investment climate by allowing more proposals to be cleared at the ministerial level.
Higher Threshold
Under the existing FDI policy, proposals involving total foreign equity inflows exceeding ₹5,000 crore have to be placed before the CCEA for consideration.
Proposals below this threshold can be decided by the respective ministries overseeing the sectors concerned.
The ₹5,000-crore limit has remained unchanged since November 2015. The CCEA, headed by Prime Minister Narendra Modi, includes key Union Cabinet ministers, including the Home and Finance ministers.
Why Review
Sources said prevailing economic conditions, inflation and the significant increase in the scale of investments over the past decade have created a case for revising the threshold.
The government also sees the proposed change as part of its efforts to improve ease of doing business and make the approval mechanism more efficient.
A committee of secretaries had earlier suggested an upward revision in the CCEA approval threshold for FDI proposals under the government approval route.
The proposal, however, is still at the discussion stage.
Downstream Rules
Separately, the government is considering easing FDI rules governing downstream investments to attract more overseas capital and support job creation.
One proposal under consideration could exempt indirect foreign investment in Indian companies from requiring fresh government approval when the upstream domestic company has already secured the necessary clearance.
Currently, prior government approval is required for downstream or indirect foreign investments in sectors covered by the government approval route and for investments originating from countries sharing a land border with India.
FDI Inflows
India has progressively liberalised its FDI framework to attract overseas investment across sectors.
Cumulative foreign direct investment into the country crossed $1.16 trillion between April 2000 and March 2026.
Among India’s leading sources of FDI are Mauritius, Singapore, the US, the Netherlands, Japan, the UK and the UAE.
