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ARTICLE · 03 AUGUST 2026

India Opens Inventory-Based E-Commerce To FDI For Exports

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On 23 July 2026, the Department for Promotion of Industry and Internal Trade (DPIIT) issued Press Note No. 3 (2026 Series) (PN3), introducing a significant but targeted relaxation to India’s foreign direct investment (FDI) framework for the e-commerce sector. Under the existing framework, FDI is permitted in business-to-business (B2B) e-commerce and the marketplace model of e-commerce. However, it is not permitted in the inventory-based business-to-consumer (B2C) model, where the e-commerce entity owns the inventory and sells directly to consumers.

IndiaGovernment, Public Sector
Moin Ladha
Moin Ladha
Tanish Prabhakar
Tanish Prabhakar
Shrudula Murthy
Shrudula Murthy
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On 23 July 2026, the Department for Promotion of Industry and Internal Trade (DPIIT) issued Press Note No. 3 (2026 Series) (PN3), introducing a significant but targeted relaxation to India’s foreign direct investment (FDI) framework for the e-commerce sector.

Under the existing framework, FDI is permitted in business-to-business (B2B) e-commerce and the marketplace model of e-commerce. However, it is not permitted in the inventory-based business-to-consumer (B2C) model, where the e-commerce entity owns the inventory and sells directly to consumers.

PN3 now creates a narrow exception by permitting foreign-funded e-commerce entities to operate an inventory-based model exclusively for the export of goods manufactured or produced in India.

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