India: An Overview

Even as the world has been unsettled by turbulence and uncertainty, India has emerged as a stable, self-assured, and ambitious political economy. It has built a reputation as a resilient and competitive player through systematic legal and regulatory reform and a state-of-the-art digital framework.

India continues to make its jurisdiction more attractive and accessible to international investors, through direct liberalisation and a more predictable business environment. For example, the proposal to increase the foreign direct investment (FDI) limit in the insurance sector from 74% to 100% signals India’s openness to foreign capital, while addressing low domestic insurance penetration by inviting global firms with expertise into the market. Separately, the Reserve Bank of India (RBI) has updated its master directions on foreign investment to clarify rules and facilitate cross-border mergers. India’s merger control regime has also been updated, specifically, the process of notifying transactions to the Competition Commission of India, including exemptions and criteria for fast-tracked approvals. A framework for reclassifying foreign portfolio investments as FDI also provides a clearer pathway for portfolio investors. Additionally, India is actively encouraging start-ups that have moved abroad to return (“reverse flipping”), to retain value and innovation in the country, through amendments to the Companies Rules.

The digital economy is being strengthened to mirror global standards, which builds trust and facilitates seamless cross-border data flows and digital trade. The Digital Personal Data Protection Rules, 2025, likely to be finalised soon, operationalise the law by creating a robust data protection regime. The Telecom Regulatory Authority of India has launched a pilot project, in collaboration with the RBI, to bring transparency and accountability for consumer consent in digital commercial communication. Efforts are also afoot to regulate emerging digital sectors, such as online gaming, influencer marketing, and e-commerce, through a mix of statutory control and self-governance.

Digitisation and modernisation of legal frameworks add heft to India’s business-friendly environment. The colonial-era Registration Act, 1908, will soon be replaced, thus digitising the entire property registration system, and leading to less red tape. The Foreign Exchange (Compounding Proceedings) Rules, 2024, streamline the processing of compounding applications by introducing digital payment options. The new Telecommunications (Right of Way) Rules, 2024, regulate underground telecommunications infrastructure on public property.

Several new rules enhance corporate transparency, accountability, and the welfare of different classes of workers. Companies must now report data on sexual harassment complaints in their board’s report, in alignment with global ESG norms. The Securities and Exchange Board of India (SEBI) has proposed amendments to regulations on share-based employee benefits, which will particularly impact companies heading for initial public offerings. Multiple Indian states, including Karnataka, Telangana, and Jharkhand, have introduced draft bills to establish welfare frameworks for gig workers – ie, those who operate outside traditional employer-employee arrangements. These bills focus on registration, database creation, and establishing welfare funds.

Another meta-theme is India’s efforts at becoming an innovation and research and development hub, evident through developments in intellectual property (IP) rights and laws. India has signed and adopted the Riyadh Design Law Treaty (DLT), a new World Intellectual Property Organization treaty, thus committing to global design law standards. Proposed draft amendments to the Patents Rules, 2003, and draft guidelines for processing patent applications connected with traditional Indian and alternative systems of medicine and healthcare (AYUSH) signal an intent to update and streamline IP processes to make them faster, more efficient, and user-friendly. New guidelines for the examination of computer-related inventions (CRIs) illuminate another knotty field of patent law. The government is looking to recast the Trade Marks Rules, 2017, specifically to speed up approvals, enable faster examinations and hearings, and reduce backlogs. Periodic special drives to dispose of old, pending trade mark applications have been undertaken. The legal framework for biological diversity has also been comprehensively updated.

Additionally, IP administration is leveraging technology to improve services and transparency. The Trademark Registry (TMR) has introduced an AI- and machine learning-based trade mark search facility, marking a major upgrade. Public dashboards at the TMR indicate a “Queue List” for various processes, which helps stakeholders forecast timelines. The move towards streamlining judicial bodies to handle IP disputes continues, with the High Courts of Calcutta and Himachal Pradesh having established Intellectual Property Divisions (IPDs).

Overall trends clearly point towards modernisation and alignment with international standards, but with multiple changes occurring at a frenetic pace, hiccups are inevitable for businesses, investors, regulators, and citizens alike. For example, the Digital Personal Data Protection Act, 2023, requires subordinate rules to provide an implementation framework. A multi-stage process brings potential for uncertainty and delays between the enactment of a law and its full and proper enforcement. Frequent replacements of old rules with new ones, such as those dealing with biological diversity or digital lending, mean that companies must constantly monitor the regulatory environment and adapt internal processes.

Separately, there is the challenge of building a judiciary with sufficient technical and legal expertise to handle complex disputes effectively. Equally, regulating sophisticated areas like AI-generated content, digital payments, and CRIs requires specialised knowledge within regulators themselves. In this context, the government has confirmed, for now, that there is no proposal to amend the Copyright Act, 1957, to specifically address AI-generated content, and that the existing Act is adequate. Relatedly, the Report on AI Governance Guidelines outlines India’s roadmap for addressing AI-specific challenges through a legally sound and inclusive approach.

Ensuring compliance in a dynamic, decentralised, and borderless digital ecosystem is another formidable task, as can be seen through regulations targeting digital content and creators, periodic advisories to streaming platforms, and the self-regulatory code for influencers.

Yet another concern is the fragmentation and ambiguity that India’s unique federal governance arrangement sometimes invites, particularly when central and state jurisdictions overlap or where new self-regulatory bodies emerge. For instance, state regulation of gig workers might respond to local needs, but can lead to fragmented regulation where companies with a nationwide presence must comply with state-level requirements. Elsewhere, self-regulatory guidelines for influencers coexist with the statutory issuance from SEBI on “finfluencers”. Here, the challenge morphs into requiring self-regulatory measures to be in alignment, rather than in contradiction, with the law.

With regulations eternally playing catch-up with rapidly evolving technology, laws are being constantly tested on parameters of relevance and effectiveness. Immediately striking is the issue of generative AI, which may demand specific amendments in the future. The law imposing a blanket prohibition on online money games demonstrates a related, but fundamental, regulatory tension of fostering innovation and economic growth in a sunrise sector, while mitigating perceived social harms. Finally, while digital-first might be a core feature of modern Indian governance, it means ensuring data security and bridging the digital divide without exacerbating existing social and economic inequalities.

It would not be presumptuous to say that India marches on its reformist trajectory, all set to take off in a digital and globalised world. It is becoming more open, more regulated, and more modern. A successful and comprehensive transformation depends on India being able to effectively implement changes while balancing control with growth.