DPIIT PUBLISHES PRESS NOTE NO. 3 (2026 SERIES)

The Department for Promotion of Industry and Internal Trade (“DPIIT”), Government of India, has published the Press Note No. 3 (2026 Series) dated July 23, 2026 (“Press Note 3”), in connection with review of the FDI Policy on e-commerce sector.

As per the extant FDI Policy, FDI is permitted in Business to Business (B2B) e-commerce and marketplace model of e-commerce. However, FDI is not permitted in Business to Consumer (B2C) e-commerce and inventory-based model of e-commerce, where inventory of goods and services is owned by e- commerce entity and is sold to the consumers directly. In order to facilitate greater exports through easier and increased access of global markets by Indian sellers, the existing FDI Policy has been reviewed, and it has been decided that the restrictions on inventory-based model of e-commerce shall not apply in case of exports of domestically manufactured and/or produced goods/products.

Pursuant to Press Note 3, a new Paragraph 5.2.15.2.5 on ‘Inventory-Based Model of E-commerce Exclusively for Exports’ is proposed to be inserted under the FDI Policy providing that: 

1. An e-commerce entity is permitted to engage in inventory-based model of e- commerce exclusively for the export of goods/products manufactured and/or produced in India as per the applicable provisions of the Foreign Trade Policy 2023 read with the Handbook of Procedures (HBP) and the Foreign Exchange Management (Export of Goods & Services) Regulations, 2015, as amended from time to time.

2. The restrictions on B2C and the inventory-based model of e-commerce stipulated under the provisions of Para 5.2.15.2.1 to Para 5.2.15.2.4 of the FDI Policy (which deals with conditionalities relating to FDI in e-commerce activities), shall not apply to the export of goods/products through e-commerce as permitted under Para 5.2.15.2.5(i) above.

3. The above decision announced under Press Note 3 is effective from the date of gazette notification under the provisions of Foreign Exchange Management Act, 1999 (FEMA), i.e., September 2, 2026.

Conclusion

Press Note 3 marks a key step in the liberalization of India’s FDI framework for e-commerce and would enable e-commerce entities that have received FDI to undertake inventory-based B2C exports of domestically manufactured or produced goods, subject to applicable export regulations and other conditionalities.