Who needs approval
Single-brand retail, wholesale and marketplaces need no approval unless a land-border investor, or a land-border beneficial owner with more than 10% or control, is involved. Multi-brand retail and food retail need Government approval. Brands can also enter without FDI through an Indian franchisee or licensee, as Lush did in November 2025.
Retail and wholesale models
| Activity | Cap and route | Key conditions |
|---|---|---|
| Single-brand product retail trading (SBRT) | 100%, automatic route | One brand, branded during manufacture. Except for Indian brands, it must be sold under the same brand abroad and by the brand owner or under a legally tenable agreement with it. Online sales may start first if stores open within 2 years. |
| SBRT with more than 51% FDI | 100%, automatic route | 30% of the value of goods purchased must be sourced from India, preferably from MSMEs, artisans and craftsmen: a five-year average from 1 April of the year the first store or online sale starts, then annually. Sourcing from India for the brand’s global operations counts. |
| Multi-brand retail trading (MBRT) | 51%, Government route | Minimum FDI USD 100 million, with half of the first USD 100 million in back-end infrastructure within three years; 30% of manufactured purchases from small Indian industries (plant and machinery up to USD 2 million); cities above 1 million population, or as states decide; no e-commerce. |
| Cash-and-carry wholesale, including B2B e-commerce | 100%, automatic route | Sales only to businesses holding tax registration or trade licences, or to institutions for own use, with day-to-day records. Sales to group companies capped at 25% of turnover. Retail alongside needs separate audited books. |
States that allow multi-brand retail
MBRT outlets are allowed only in states and union territories that have agreed: Andhra Pradesh, Assam, Delhi, Haryana, Himachal Pradesh, Jammu & Kashmir, Karnataka, Maharashtra, Manipur, Rajasthan, Uttarakhand, and Daman & Diu and Dadra & Nagar Haveli.
Note: Tamil Nadu is not on the consenting list. A multi-brand retailer planning stores there would need a different model.
E-commerce, food retail and duty-free shops
E-commerce, food retail and duty-free shops each have their own conditions. Press Note 3 (2026) opened inventory-based e-commerce for exports only.
| Activity | Cap and route | Key conditions |
|---|---|---|
| E-commerce: marketplace model | 100%, automatic route | No ownership or control of inventory (a vendor buying over 25% from the marketplace group is deemed controlled); no sales by sellers in which the marketplace group holds equity; no influence on prices; no exclusivity; statutory auditor’s report by 30 September each year. |
| E-commerce: inventory model | Barred for domestic sales; allowed for exports | Press Note 3 (2026), 23 July 2026: marketplace entities with FDI may hold inventory to export goods made or produced in India, under the Foreign Trade Policy and FEMA. The FEMA rules were amended by S.O. 4870(E) of 2 September 2026, in force from its publication on 3 September 2026. |
| Retail of food made or produced in India, including online | 100%, Government route | Applies only to food products manufactured or produced in India. Separately, a manufacturer in India may sell its own products through wholesale, retail and e-commerce without approval. |
| Duty-free shops | 100%, automatic route | Only in customs bonded areas at international airports, seaports and land customs stations, subject to the Customs Act 1962; no retail in the domestic tariff area. |
Land-border investors
| Activity | Cap and route | Key conditions |
|---|---|---|
| Any investor with a beneficial owner in a land-border country | Government route; automatic up to 10% without control | Press Note 2 (2026): a beneficial owner holds more than 10%, or control, as defined in anti-money-laundering law. Up to 10% without control: automatic, with prior reporting. Applications go through the FIF portal on NSWS. |
The land-border condition applies to every activity on this page, including single-brand retail on the automatic route. Proposals with land-border beneficial owners also go to the Ministry of External Affairs for comments. The general rules are set out under land-border investors.
Entry without FDI
A franchise or licence with an Indian partner needs no foreign investment, so none of the caps or sourcing conditions apply; the stores, however, belong to the partner. On a marketplace, delivery, warranty and pricing rest with the seller, not the platform. Both routes are compared on the set-up roadmap.
What to check next
- Confirm the brand is branded during manufacture and sold under the same brand abroad, and that the Indian entity is the brand owner or holds a legally tenable agreement with it.
- If FDI will exceed 51%, set up purchase tracking by brand from the first year; the 30% test is self-certified and then checked by statutory auditors.
- For multi-brand retail, confirm the USD 100 million minimum, the back-end infrastructure commitment and the consenting-state list before choosing locations.
- For a marketplace, test every vendor relationship against the 25% purchase threshold, the equity bar and the price-influence rule, and diarise the 30 September auditor’s report.
- Map every beneficial owner for land-border links; above 10% or control, the case goes to the Government route through the FIF portal on NSWS.