Electronics, rare earths among sectors to get faster FDI approvals under amended Press Note 3: MeitY

India has clarified the contours of foreign investment scrutiny from neighbouring countries, even as it moves to streamline approvals in sectors critical to its manufacturing ambitions.

In an interview with CNBC-TV18, S Krishnan, Secretary at the Ministry of Electronics and Information Technology, said the recent amendment to Press Note 3 should not be viewed as a relaxation but as an effort to bring clarity and faster processing in select sectors.

The government has now defined, for the first time, the threshold at which an investor entity is considered linked to a land-bordering country. Under the revised framework, if 10% or more of an investor company’s ownership originates from a land-bordering country, the investment will fall under the Press Note 3 scrutiny regime.

The updated framework also introduces a fast-track approval mechanism for investments in select sectors such as electronics, electronic components, rare earth materials and solar supply chains, where India sees a strategic need for capital and technology partnerships.

In these sectors, the government will presume the need for investment, eliminating additional scrutiny from the concerned line ministry and enabling approvals to be processed within 60 days, though security and political vetting will continue.

Krishnan acknowledged that a significant portion of such investments are expected to originate from China, reflecting the country’s dominance in electronics manufacturing and supply chains.

“It is primarily Chinese companies, as you can well imagine,” he said, adding that electronics has been one of the largest sectors for approvals under the Press Note 3 framework in recent years.

The policy recalibration comes as India’s electronics manufacturing ecosystem expands rapidly, with policymakers seeking to balance security considerations with the need for technology, capital and supply-chain integration in critical industries.

The government has also retained the flexibility to modify the list of sectors eligible for expedited approvals, signalling that the framework could evolve as India’s technology and manufacturing priorities shift.By CNBCTV18March 16, 2026, 7:09:17 PM IST (Updated)Continue ReadingFirst Published: Mar 16, 2026 7:09 PM IST

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