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The government on Tuesday eased norms for foreign direct investment from all countries, including China, that share land borders with India, PTI reported quoting sources. Sources said press note 3 of 2020 has been amended in this regard. The decision was taken in a meeting of the Union Cabinet chaired by Prime Minister Narendra Modi.
Under this press note, foreign companies having shareholders from these countries required mandatory government approval for investments in India in any sector, according to PTI. Countries that share land borders with India are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan. China stands at the 23rd position with only 0.32 per cent share ($2.51 billion) in the total FDI equity inflow reported in India from April 2000 to December 2025.
Ties between the two countries nosedived significantly following the fierce clash in Galwan Valley in June 2020 that marked the most serious military conflict between the two sides in decades. Following these tensions, India banned over 200 Chinese mobile apps like TikTok, WeChat, and Alibaba's UC browser, as per PTI.
Though India has received minimal FDI from China, bilateral trade between the two nations has grown multi-fold. China has emerged the second-largest trading partner of India.
India-China trade
In 2024-25, India's exports to China contracted 14.5 per cent to $14.25 billion as against $16.66 billion in 2023-24. Imports, however, rose 11.52 per cent in 2024-25 to $113.45 billion against $101.73 billion in 2023-24. The trade deficit was widened to $99.2 billion in 2024-25 from $85 billion in 2023-24.
During April-January 2025-26, India's exports to China rose 38.37 per cent to $15.88 billion, while imports rose 13.82 per cent to $108.18 billion. Trade deficit stood at $02.3 billion.
India-China flights
After a gap of five years, India and China resumed direct flight services from October 2025, as part of efforts to rebuild their ties that came under severe strain following the border standoff in eastern Ladakh.
The announcement by the Ministry of External Affairs (MEA) was made after Prime Minister Narendra Modi and Chinese President Xi Jinping held talks on the margins of the Shanghai Cooperation Organisation's summit in China's Tianjin city.
"Since earlier this year, as part of the government's approach towards gradual normalisation of relations between India and China, the civil aviation authorities of the two countries have been engaged in technical-level discussions on resuming direct air services between the two countries and on a revised air services agreement," the MEA then said. (With Agency Inputs)
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