Effective or announced 17 August 2026Impact for foreign investors: medium
What changed
The Act replaced the June 2026 ordinance. It drops the 25-member, 10% single-investor and ₹100 crore corpus tests for offshore funds managed from India, allowing Indian residents up to 5%. FII income on government securities is exempt. Foreign suppliers of tooling to bonded electronics contract manufacturers are exempt to the tax year ending 31 March 2041, and component warehousing income is exempt from 1 October 2026 to 31 March 2041.
Who it affects
Offshore fund managers, FIIs, and foreign suppliers to electronics contract manufacturers.
What to do
Review fund structures against the new safe harbour and check prescribed reporting for the electronics exemptions.