China’s share in India’s foreign direct investment (FDI) approvals remained largely negligible in 2025-26, with the government approving just one proposal worth Rs 1 crore during the year. In comparison, 13 proposals from Hong Kong, together worth Rs 610.42 crore, received approval, according to official data. These approvals fall under India’s investment screening rules for countries sharing a land border with the country. Introduced through Press Note 3 of the Department for Promotion of Industry and Internal Trade (DPIIT) in April 2020, the policy requires prior government approval for such investments. The regulations were brought in during the Covid-19 pandemic to curb opportunistic takeovers and acquisitions of Indian companies.During April 2025 to March 2026, the government approved 63 FDI proposals with a total investment value of Rs 10,292.67 crore ($1.18 billion), according to DPIIT data.Among all countries whose proposals were cleared, Singapore accounted for the highest approved investment value. Five proposals from the country worth Rs 3,259.88 crore ($382.52 million) received approval.The UK followed with five proposals worth Rs 2,477.67 crore ($283 million), while two proposals from Thailand valued at Rs 1,600 crore (about $180 million) were also cleared.

Press Note 3 eased

Back in March, the government revised certain provisions of Press Note 3, allowing investors with non-controlling beneficial ownership of up to 10% from land border countries (LBCs) to invest through the automatic route, subject to applicable sectoral caps, entry routes and other conditions.However, the relaxation does not extend to entities registered in China, Hong Kong or any other country sharing a land border with India. The countries sharing land borders with India are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan.

China remains a small source of FDI

Official data also shows that China has remained a relatively small contributor to India’s overall FDI inflows. Between April 2000 and March 2026, the country ranked 23rd among FDI sources, accounting for only 0.32% of India’s total FDI equity inflows. During the period, Chinese investments totalled $2.51 billion, or Rs 16,162.25 crore.Hong Kong ranked 15th over the same period, with a 0.62% share in total FDI equity inflows into India. Cumulative investments from the territory stood at $4.91 billion, equivalent to Rs 31,220.30 crore.The latest approvals are broadly in line with the previous financial year.In 2024-25, India had also approved only one FDI proposal from China. That proposal was valued at Rs 28.71 crore ($3.44 million). Overall, the government had cleared 82 proposals under the government route during the year, involving investments worth Rs 39,758 crore ($4.72 billion).Hong Kong, meanwhile, received approvals for 11 proposals worth Rs 1,225.28 crore ($146.51 million) during 2024-25.