Commerce Ministry Exempts Exports From FDI Restrictions

India's Ministry of Commerce and Industry has lifted restrictions on foreign direct investment (FDI), allowing e-commerce operators to export goods manufactured in the country. The move, effective immediately, follows years of industry advocacy.

The revised regulations permit FDI in business-to-business (B2B) e-commerce and marketplace models. However, existing rules restricting inventory-based business-to-consumer (B2C) e-commerce for domestic sales remain in place. This change allows companies like Amazon and Walmart's Flipkart to procure products directly from Indian sellers for export.

According to a press circular, the limitations on inventory-based e-commerce models will not apply to the export of domestically manufactured and produced goods. The objective is to bolster India's export sector by enhancing global market access for local sellers.

This policy adjustment comes after government reviews and consultations with industry stakeholders that began last year. Major e-commerce players, including Amazon, had lobbied for the removal of these FDI restrictions concerning exports. The government aims to support its target of generating $200-$300 billion in e-commerce exports by 2030.