Three layers of approval
A foreign investor deals with three separate layers. It helps to keep them apart when planning.
- FDI approval. Needed only on the government route or where a land-border owner is involved. On the automatic route, the investment is reported after the event.
- Company and tax registrations. Incorporation, PAN, TAN, GST, IEC and labour registrations. These apply to every entity.
- Sector licences and site approvals. Regulator licences (for example RBI, IRDAI, SEBI or telecom authorisation) and, for a plant, land, environmental, building and factory approvals.
The automatic route
There is no prior approval: the investor invests where the sector allows it, within the cap and its conditions. Downstream investment by a foreign-owned Indian company follows the same entry, cap and pricing rules. The obligations come after the event:
- Price at or above fair value. Unlisted shares issued to non-residents may not be priced below fair value set by a SEBI-registered merchant banker or chartered accountant; valuations must be under 90 days old.
- Allot within 60 days. Shares must be issued within 60 days of receiving the money; otherwise the funds are refunded within the following 15 days.
- Report. FC-GPR within 30 days of issuing shares, and an FLA return to RBI by 15 July each year.
Check: Draft Foreign Investment Rules to replace the NDI Rules were released for consultation from 21 July to 31 August 2026; check their status before closing a deal.
FDI approval on the government route
Proposals are filed on the Foreign Investment Facilitation (FIF) portal on the National Single Window System (NSWS). DPIIT routes the file to the administrative ministry for the sector; the Ministry of Home Affairs comments, and the Ministry of External Affairs also comments on land-border cases. Proposals above ₹5,000 crore of foreign equity go to the Cabinet Committee.
DPIIT’s standard operating procedure of 4 May 2026 sets these targets:
| Proposal | Decision target |
|---|---|
| Standard government-route proposal | 12 weeks |
| Where rejection or additional conditions are proposed | A further two weeks |
| Land-border investor taking up to 49% in an Indian-controlled company in a listed sector | 60 days |
Time the applicant takes to respond is excluded. See land-border investors for the listed sectors.
Deadlines fixed by rule
Only some steps have a time limit set by law or regulation. These are the ones a foreign investor will meet first.
| Event | Deadline | Where |
|---|---|---|
| Allot shares after receiving capital | Within 60 days of receipt; refund within the next 15 days if not allotted | Company and authorised dealer bank |
| Report share issue (FC-GPR) | Within 30 days of issue | RBI FIRMS portal |
| Report share transfer (FC-TRS) | Within 60 days of transfer or of receipt or remittance of funds, whichever is earlier | RBI FIRMS portal |
| Declare commencement of business | Within 180 days of incorporation | MCA |
| File LLP agreement | Within 30 days of incorporation | MCA |
| Land-border prior report (within 10%, no control) | Before the money is remitted | FIF/NSWS |
| Automated GST registration (low-risk applicants) | 3 working days | GST portal |
| Defence: new foreign investment up to 49% in a company not seeking a new licence | Declaration within 30 days | Ministry of Defence |
| Annual FLA return | By 15 July each year | RBI |
The full annual calendar is on the FEMA compliance calendar page.
Sector licences and site approvals
Sector regulators run their own processes, and in most cases the sources state no fixed timeline: timing varies by authority, state and project category. Typical approvals for a manufacturing project include:
- Industrial Entrepreneur Memorandum (Parts A and B), filed with DPIIT on NSWS only
- an industrial licence from the central government for defence and arms items
- land allotment from a state industrial development corporation or a National Industrial Corridor node
- consent to establish and consent to operate from the State Pollution Control Board, and hazardous-waste authorisation where relevant
- building plan approval and a factory licence; factory safety now falls under the Occupational Safety, Health and Working Conditions Code 2020, with existing rules continuing during the transition
- a power connection from the state distribution company
- BIS certification where a Quality Control Order applies
- an IEC from DGFT, and a customs warehouse licence (s.58) and permission under s.65 of the Customs Act 1962 for bonded manufacturing
Regulated activities in finance, insurance, telecom, health products and data each need their own licence before business starts. The sector guides set these out.
Note: CDSCO targets 90 days for cosmetics import registration. Where a regulator publishes a target like this, treat it as a target, not a guarantee.
Single windows and escalation
NSWS is the national approvals portal, and the Economic Survey 2025-26 asks states to link their single windows to it. Some states run their own: Uttar Pradesh’s Nivesh Mitra offers 353 services of 29 departments. For projects above ₹500 crore, the Project Monitoring Group, working with Invest India, helps resolve issues that hold up a project.
What to check next
- Decide early whether any part of the structure triggers the government route or the land-border rule; that sets the critical path.
- List every sector licence and site approval the project needs, with the issuing authority for each.
- Diary the fixed deadlines (allotment, FC-GPR, commencement) from the date each is triggered.
- Confirm whether the state single window is linked to NSWS and which approvals it covers.
- For large projects, check whether the Project Monitoring Group route is available.