From FOCC to FCE: Decoding India’s new foreign investment rules

Grant Thornton Bharat’s PolicyCast is your window into policy, tax, and regulatory developments. Each episode features expert perspectives on issues that matter to businesses, individuals, and the wider economy.

India’s foreign investment framework is heading for a significant reset.

The Draft Foreign Exchange Management (Foreign Investment) Rules, 2026 propose to replace the existing 2019 framework in its entirety, with changes that could affect how foreign investment is structured, classified and reported.

In the latest episode of #GTBharat’s PolicyCast podcast series, Riaz Thingna, Partner, Tax, decodes the proposed changes and their implications for investors, businesses and advisors.

The discussion covers:

• The shift from “non-debt instruments” to “equity”.
• The move from FOCC to the new Foreign-Controlled Entity framework.
• The proposed 10% threshold for control and FDI classification.
• The wider range of entities that can receive foreign investment.
• Key areas requiring greater clarity before implementation.

With the proposed rules introducing a new structure for foreign investment in India, the consultation period also presents an important opportunity for stakeholders to examine the practical implications and areas that may need further clarification.

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