Business
India revisits Press Note 3: Key clarifications to FDI framework for investments from land-bordering countries
This change was introduced in the backdrop of the economic disruption caused by the COVID-19 pandemic, with the stated objective of curbing opportunistic takeovers and acquisitions of stressed Indian companies. At the same time, the measure was widely viewed as a response to growing geopolitical concerns, particularly in relation to investments originating from China, given the rising tensions along the Indo-China border.
Ambiguities and practical challenges under Press Note 3
Under Press Note 3, any direct or indirect investment into India from an entity incorporated in a country sharing a land border with India, or where the beneficial owner of such investment is situated in, or is a citizen of, such a country (including China, Hong Kong, Macau and other neighboring jurisdictions), requires prior approval of the Government of India. However, neither Press Note 3 nor the subsequent amendments to the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 (NDI Rules) clarified the threshold for determining “beneficial ownership”. This lack of clarity was particularly notable given that other Indian legislations, such as the Companies Act, 2013 and the Prevention of Money Laundering (Maintenance of Records) Rules, 2005, prescribe a 10% threshold for identifying beneficial ownership. In the absence of an express threshold under the FDI framework, considerable uncertainty emerged regarding both the ambit of the beneficial ownership test and the level within the ownership chain at which such ownership was required to be assessed.
In practice, investors often operate through multi-layered global structures spanning several jurisdictions. The absence of clear guidance on whether beneficial ownership needed to be traced up to the ultimate beneficial owner, coupled with the lack of a prescribed threshold, created significant interpretational challenges. As a result, even minority or non-controlling shareholdings held by investors from land-bordering countries, or minimal exposure to such investors within global funds, were frequently viewed as potentially triggering the requirement for prior government approval.
Consequently, a conservative interpretation of Press Note 3 emerged in practice, whereby any investment involving direct or indirect beneficial ownership from China, Hong Kong, Macau or other land-bordering jurisdictions, irrespective of the size of such ownership, could potentially require prior approval of the Government of India. This interpretation led to significant uncertainty and delays, particularly in the context of venture capital and private equity investments involving globally diversified investor bases.
In addition, the approval process itself often proved time-consuming. In several cases, obtaining approval under the Press Note 3 framework took anywhere between six and eight months, and sometimes longer. This significantly affected deal timelines and execution certainty, particularly for time-sensitive venture capital and private equity transactions.
Clarification to the Press Note 3 framework
Recognising the practical challenges associated with the implementation of Press Note 3, the Government of India has approved certain amendments aimed at providing greater clarity and improving the efficiency of the approval process. The amendments primarily address two aspects of the Press Note 3 framework, namely, the determination of beneficial ownership and the timeline for processing approvals in certain strategic sectors.
First, the amendment introduces clarity with respect to the concept of “beneficial ownership”. The revised framework aligns the determination of beneficial ownership with the standards prescribed under the Prevention of Money Laundering (Maintenance of Records) Rules, 2005. It provides that investments where beneficial ownership from entities of countries sharing land borders with India is limited to non-controlling holdings of up to 10% may be permitted under the automatic route, subject to applicable sectoral conditions and reporting requirements. This clarification is intended to address the long-standing uncertainty surrounding the interpretation of beneficial ownership under the Press Note 3 regime. The amendment further clarifies that the beneficial ownership test shall be applied at the level of the investor entity, thereby providing greater certainty on the level at which such ownership is required to be assessed.
Second, the amendments introduce a time-bound approval mechanism. Under the revised framework, proposals involving such investments in sectors including capital goods, electronic capital goods, electronic components, polysilicon and ingot-wafer manufacturing are required to be processed and decided within 60 days. At the same time, the framework provides that majority ownership and control of the Indian investee entity must remain with resident Indian citizens or Indian-owned entities for the 60 days’ timeline to be applicable to it.
Policy implications of the amendments
These amendments signal a calibrated shift in the Press Note 3 regime by seeking to balance national security considerations with the need to facilitate foreign investment, particularly in strategic manufacturing sectors that form part of India’s broader industrial and technology supply chains. While the core objective of screening investments from land-bordering countries continues to remain intact, the amendments indicate an effort by the Government to address the practical challenges that had emerged in the implementation of the framework. The changes are also broadly aligned with the Government’s continuing focus on improving the ease of doing business in India, particularly by providing greater regulatory clarity and reducing uncertainty for cross-border investors.
The clarification that the beneficial ownership test will be applied at the level of the investor entity, along with the introduction of a 10% threshold for non-controlling beneficial ownership, is likely to provide significant relief to global investment structures. Venture capital and private equity funds often have diversified general partner and limited partner bases across multiple jurisdictions, including passive investors from land-bordering countries. Under the earlier interpretation of Press Note 3, even minimal exposure to such investors could potentially trigger the requirement for prior government approval. The revised framework reduces this uncertainty by carving out non-controlling holdings below the prescribed threshold, thereby enabling global funds to deploy capital into India with greater regulatory clarity.
Further, the introduction of a time-bound approval mechanism for investments in certain manufacturing sectors reflects the Government’s broader policy objective of strengthening India’s domestic manufacturing ecosystem, particularly in segments such as electronics and semiconductor supply chains. By committing to process such proposals within 60 days, the Government appears to be signalling its willingness to facilitate investments that contribute to India’s strategic industrial capabilities, while continuing to retain safeguards around ownership and control.
The real test, however, will lie in how these changes are implemented in practice.
(Moin Ladha is Partner and Tanish Prabhakar is Senior Associate at Khaitan & Co. Views expressed are personal.)
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Business
Housing sales in 50 cities dip 3% to 6.14 lakh units, up 16% in value to Rs 8.4 lakh crore: CREDAI
On Friday, realtors’ apex body The Confederation of Real Estate Developers’ Associations of India (CREDAI) and research firm Liases Foras, released a report on residential real estate trends across 50 major cities in India.
The report highlighted the continued resilience of the housing market, with strong value growth driven by rising buyer aspirations, increasing premiumisation of housing demand and sustained infrastructure-led urban development.
As per the data, the housing sales across primary markets of Indian 50 major cities fell 3 per cent to 6,14,235 units in 2025 from 6,33,134 units in the preceding year.
In value terms, sales grew to Rs 8,46,648 crore last year, an increase of 16 per cent from 7,29,112 crore during 2024 calendar year.
Shekhar Patel, President of CREDAI, said: “The 2025 numbers mark more than a statistical milestone, they reflect a fundamental shift in how India lives, invests and aspires. When 78 per cent of sales value comes from homes priced above Rs 1 crore and ultra-luxury alone drives over half the value, it signals rising household wealth, maturing investor confidence and the success of urban infrastructure initiatives”.
He noted that Tier-2, 3 and 4 cities are no longer peripheral and they are emerging as engines of economic opportunity.Pankaj Kapoor, Managing Director of Liases Foras, said: “Top metro cities continue to dominate India’s housing market in 2025 in sales, value and supply. However, Tier-2 cities are increasingly emerging as important growth centres in the residential real estate sector.
Better connectivity, expanding employment hubs, and infrastructure-driven initiatives are boosting housing demand in these markets for both end-users and investors, he added.
Country music star Brantley Gilbert speaks to Fox News Digital about his latest equity partnership with Real American Beer and his 14-year sobriety.
Brantley Gilbert, the seven-time No.1 country hit singer-songwriter, has experienced more than one occasion in his life where his 14-year sobriety felt like sitting on the sidelines.
“Nothing beats a cold beer when you’re grilling out or watching a game with your buddies, your family. And as a country music songwriter, we write about cold beer in every other song,” Gilbert told Fox News Digital.
“This is a chance for those of us that have taken alcohol out of our lives for one reason or another to drink a cold beer,” he said, “and share one with our buddies.”
America’s oldest and youngest generations are drinking less, with U.S. alcohol use hitting its lowest point in nearly a century, according to the 2025 Gallup Consumption Habits survey. Only 54% of adults reported using alcohol last year, with half of 18-to-34-year-olds not drinking at all — a steep drop from the 72% of young adults who did two decades ago.
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The desire to cut back on alcoholic beverages has poured into a budding market of non-alcoholic beers and wines, which Gilbert is now proudly a part of.
Country music star Brantley Gilbert speaks to Fox News Digital about why he’s investing in Real American Beer’s first non-alcoholic offering. (FOXBusiness)
Going from fan to owner, the country music powerhouse is Real American Beer’s (RAB) latest major equity partner. He’s spearheading the launch of RAB Zero, the brand’s first non-alcoholic drink that promises “real beer energy” without compromise.
For every case that’s sold, RAB plans to donate $1 to the U.S.O.
“The RAB folks are just next-level people, and they’re patriots,” Gilbert said. “They’re about God, family and country, and that’s easy to get on board with for me.”
Wrestling legend wants to bring America back together, ‘one beer at a time.’
Real American Beer aims to set itself apart from rivals by making the beer a part of a meaningful experience rather than focusing on the product itself. The brand launched in 2024 and pays homage to its late founder, Hulk Hogan.
Led by former Anheuser-Busch InBev executive Terri Francis, he previously told FOX Business that it had been Hogan’s dream to “be bigger than Bud Light” before his death in July 2025 at age 71, just over a year after launching the company.
“[Growing] up, watching wrestling, I thought Hulk Hogan was almost the second coming, and getting a chance to meet him and knowing what he was up to with Real American Freestyle, I got a chance to kind of become friends with him and writing the theme song for that, what he wanted it to sound like,” Gilbert reflected. “Really, you know, the conversation had to develop into, what do you want this brand to be about? And obviously that was just all-American.”
NCAA All-American and MMA Champion Colby Covington and Real American Beer CEO Terri Francis discuss their partnership on ‘Varney & Co.’
“I don’t really partner with people that I don’t believe in or products that I don’t use myself,” he added. “Having a stake in the game obviously adds to the equation.”
Gilbert, who has been sober since December 2011, explained why he wanted a product that allowed people to participate in “beer moments” without alcohol.
“I finally came to terms with the fact that I’m allergic to alcohol, like I break out in handcuffs and bad decisions,” Gilbert said.
“It’s not that I can’t drink. It’s that I choose not to, you know what I mean? It’s a choice. And I think people are a little more respectful towards that… This is an option… for beer lovers like myself to still pop a top and cheers your buddies and have a cold beer without having all the bad decisions, all the negative things that come with it.”
Soft Bar founder and reality TV star Carl Radke breaks down America’s declining alcohol consumption, his sobriety journey and building a business around the booze-free movement on ‘Maria Bartiromo’s Wall Street.’
The country music star views this partnership as a way to carry the torch for his late friend while celebrating his own personal redemption as a married dad of three.
He also sees 2026 as “a hell of a ride,” even teasing that more new music is coming.
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“My story is one of those being blessed… My wife coming back in the picture and giving me a chance to love her after not seeing or speaking to each other for six or seven years,” Gilbert said. “It is this kind of redemption story that, without, frankly, I would be not in a great place.”
“Years down the road, God willing, we are cheers-ing and celebrating not just the success story of this brand, but the success story of American patriotism.”
FOX Business’ Daniella Genovese contributed to this report.
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