India: Inward/ Foreign Investment

India's quick commerce (“Q-commerce”) sector has surged with unprecedented speed, transforming the way consumers access goods and redefining the expectations of last-mile delivery. Platforms such as Blinkit, Swiggy Instamart, and Zepto now promise delivery in a matter of minutes, turning instant gratification from a convenience into a near-necessity. Yet, behind this whirlwind of rapid growth lies a labyrinth of regulatory and legal challenges that can threaten even the most successful players.

The August 2026 edition of Fox & Mandal's newsletter examines Draft Foreign Exchange Management (Foreign Investment) Rules, 2026; intraday borrowing by mutual funds; Draft SHANTI Rules, 2026; strengthened borrower protection framework; FDI relaxation in export-oriented inventory-based e-commerce; tax exemptions for foreign investors; interest rate for HAM projects; and other changes in India's corporate, capital markets, infrastructure, and banking sectors.

Foreign capital can now reach almost every layer of an Indian airline’s balance sheet, but control cannot. Every foreign strategic investor and private equity sponsor must internalize before drafting term sheets for a domestic carrier. The percentage of equity a foreign party may hold and the degree of control it may exercise are governed by two separate legal regimes that do not move together, and the gap between them is where most aviation deals in India succeed or unravel.

The Department for Promotion of Industry and Internal Trade (“DPIIT”), Ministry of Commerce and Industry, Government of India, on 23.07.2026, issued Press Note No. 3 (2026 Series) (DPIIT F. No. P-15015/9/2025-FDI Policy) (“Press Note”) , reviewing the Foreign Direct Investment (“FDI”) policy applicable to the e-commerce sector.

Special Economic Zones offer export-oriented businesses and foreign investors a distinct fiscal and regulatory framework to operate in India. What tax exemptions, customs benefits, and compliance obligations apply to SEZ units under current law, and how have recent amendments reshaped the policy landscape for semiconductor manufacturing and domestic market sales?

India’s aviation sector is one of the fastest-growing in the world, and for the businesses driving it, working with the right aviation law firm in India has become as important as operational efficiency. Aviation legal and regulatory compliance in India now spans airport expansion, aircraft leasing and finance, cross-border repossession, foreign investment, drone technology and dispute resolution.

The Reserve Bank of India has introduced significant amendments to the Foreign Exchange Management Regulations, fundamentally restructuring how Non-Resident Indians and Overseas Citizens of India can invest in Indian markets. These changes modify payment mechanisms, remittance frameworks, and reporting requirements for investments made on a repatriation basis. The amendments also extend to equity shares of Indian companies listed on International Exchanges, introducing new flexibility in payment options.

The webinar “Investing in India – Public M&A” hosted by Khaitan & Co, has been designed to enhance the understanding of key issues relevant to existing and prospective foreign investors doing business in India. The session focuses on public mergers and acquisitions (M&A), specifically the processes involved in acquiring, merging with, or taking a controlling stake in an Indian listed company.

India's net Foreign Direct Investment inflows are projected to rebound to nearly USD 15 billion in FY27, signaling a new growth phase for foreign investment. As investment volumes increase, businesses must navigate complex FEMA regulations, RBI compliance requirements, and sector-specific FDI policies to capitalize on emerging opportunities while maintaining regulatory preparedness.