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“India’s recalibration of Press Note 3 signals a shift from passive deficit management toward a more deliberate strategy of fostering strategic partnerships.
Originally introduced to safeguard Indian businesses and mitigate the risk of opportunistic or hostile acquisitions during a period of economic vulnerability, Press Note 3 placed investments from countries sharing a land border with India under the government approval route. While the measure served an important protective purpose, it also had the practical effect of moderating opportunities for technology localisation and deeper domestic manufacturing collaborations, particularly in sectors such as electric vehicles and electronics, thereby sustaining a degree of dependence on imports.
The proposed easing may be better understood not as an indiscriminate opening, but as a calibrated “trade-for-investment” approach aimed at facilitating capital and technology inflows under regulatory supervision. The policy changes appear geared toward strengthening domestic supply chains and industrial capabilities while remaining consistent with India’s broader strategic and regulatory priorities.”