Korea Newsletter (January - March 2026)

India, during January to March 2026, has continued to deepen its economic and regulatory engagement with South Korea through a series of policy measures and bilateral initiatives across sectors where Korean companies maintain a strong presence, including electronics manufacturing, electric mobility, semiconductors, shipbuilding, batteries, and advanced materials. These developments reflect a broader policy direction focused on supply chain resilience, technology partnerships, ease of doing business, and facilitation of long-term foreign investment.

Key developments span strategic sectors of shared interest. Industrial policy momentum has continued through targeted incentives and localisation efforts in electronics, waste management alongside evolving standards and compliance frameworks. The bilateral engagement has also remained active, with continued dialogue under the Comprehensive Economic Partnership Agreement India South Korea framework, and renewed focus on facilitating trade, addressing market access barriers, and strengthening cooperation in emerging technologies and critical minerals.

In this newsletter, we highlight key legal and regulatory developments in India over recent months. 

요약

1. 섹션 A: 섹터별 업데이트인도 반도체 미션 (ISM) 2.0 발표

2026-27년 연합 예산은 장비, 자재 및 전체 지적 재산 개발에 중점을 두고 인도의 반도체 생태계를 심화하기 위해 ISM 2.0을 발표했습니다. 1억 1천만 달러의 지원을 바탕으로 이 이니셔티브는 ISM 1.0의 인센티브 중심 프레임워크를 기반으로 합니다. 또한, 국내 역량과 글로벌 공급망 통합을 강화하기 위해 산업 주도 연구 개발 및 기술 개발을 강조합니다. 

2. 전자 부품 제조 계획 (ECM 계획) 

ECM 제도는 44억 달러의 예산 증액으로 탄력을 받았으며, 이는 2026-27년도 연방 예산의 일환으로 국내 전자제품 제조 산업을 강력히 지원하겠다는 의지를 보여주는 것입니다. ECM 계획은 하위 조립품 및 자본재를 포함한 구성 요소 수준의 생산을 우선시합니다. 이는 인도에서 통합된 종합 전자 제조 생태계를 만들기 위한 반도체 이니셔티브를 보완하는 것입니다. 

3. 대기(오염의 예방 및 통제) 법, 1981 및 수질(오염의 예방 및 통제) 법, 1974에 따른 통합 동의 지침 개정 

통합 동의 지침에 대한 개정은 운영 동의의 유효기간을 취소 시까지 연장하고, 고오염 산업에 대한 승인 기간을 단축함으로써 규제 절차를 간소화합니다. 또한 특정 중소 및 영세 기업(MSMEs)에 대해 간주 승인을 도입하고, 부지별 요구사항을 전문가 기관으로 이전합니다. 이러한 변경은 환경 감독을 유지하면서 사업 수행의 용이성을 개선하는 것을 목표로 합니다. 

4. 2026년 고형 폐기물 관리 규칙 공포

2026년 고형 폐기물 관리 규칙은 적용 범위를 농촌 지역으로 확대하고 효율성과 지속 가능성을 개선하기 위해 의무적인 4분류 폐기물 분리를 도입합니다. 이 규칙은 대량 폐기물 발생자의 정의를 확대하고, 분산 처리를 포함한 보다 엄격한 준수 의무를 부과합니다. 또한 폐기물 관리에서 책임성을 강화하기 위해 캡 앤 트레이드 방식의 대량 폐기물 발생자 책임 프레임워크도 도입됩니다. 

5. 소수력 발전 개발 계획(SHP Scheme) 발표

SHP 계획은 2026~31 회계연도 동안 미화 2억 8,400만 달러의 예산으로 승인되었으며, 특히 산악 및 북동부 지역에서 1,500 메가와트의 용량을 목표로 합니다. 이 계획은 중앙 재정 지원과 프로젝트 개발 및 상세 프로젝트 보고서에 대한 자금을 제공합니다. SHP 계획으로 투자 촉진, 고용 창출 및 분산형 재생 에너지 촉진이 기대됩니다.

6. 바이오 파마 샥티 계획(Shakti Scheme)

5년간 미화 1억 1,000만 달러의 예산으로, Shakti Scheme은 생물의약품 및 바이오시밀러 분야에서 인도의 바이오제약 생태계와 글로벌 경쟁력을 강화하는 것을 목표로 합니다. 이 계획에는 자금 지원, 인프라 확장, 임상시험 네트워크 및 규제 강화가 포함됩니다. Shakti Scheme은 수입 의존도를 줄이면서 국내 제조, 혁신 및 보다 빠른 승인 촉진을 목표로 합니다.

섹션 B: 일반 업데이트

1. 2026년 외환 관리(보증) 규정

인도 중앙은행(RBI)은 거래의 합법성과 연결된 원칙 기반 접근 방식으로 전환함으로써, 기존의 규정 중심 승인 체계에서 국경 간 보증 프레임워크를 전면 개편했습니다. 이 규정은 명확한 정의를 도입하고, 해외로부터의 보증을 명시적으로 허용하여 규제 명확성을 향상시킵니다. 또한 보고 지연을 정규화하기 위한 구조화된 지연 제출 수수료 메커니즘도 도입되었습니다. 

2. 2026년 외환 관리 (상품 및 서비스의 수출입) 규정

2026년 외환 관리 (상품 및 서비스의 수출입) 규정은 수출 보고를 단일 수출 신고서로 통합하고 상품, 서비스 및 소프트웨어 전반에 걸쳐 일정 절차를 간소화합니다. 이 규정은 수출 대금 회수 기간을 연장(루피 거래의 경우 최대 18개월)하고, 계약 유연성과의 정합성을 위해 엄격한 수입 결제 기한을 제거합니다. 또한 이 프레임워크는 상품 및 서비스 거래 간 상계를 허용하고, 지정 외환은행에 더 큰 책임을 부여합니다. 

3. 2026년 SEBI 상장 의무 및 공시 요건(개정) 규정 공표 

이 개정안은 특별 주주 권리의 공시를 공식화하고 투자자 서비스 절차를 단순화함으로써 기업 지배구조를 강화합니다. 또한 확인서와 같은 중개 절차를 제거하고 처리 기간을 크게 단축합니다. 고가치 부채 상장 기업의 기준도 상향 조정되어 중형 기업의 규제 준수를 완화합니다. 

4. 대법원, 제21조에 따른 중재 절차 개시 시점 명확화

대법원은 1996년 중재 및 조정법(Arbitration Act) 제21조에 따라 중재 개시 통지가 접수되는 시점에 중재 절차가 개시된다고 명확히 했습니다. 이 입장은 중재법 전반에 걸쳐 동일하게 적용되며, 이전의 사법적 견해 차이를 해소하는 것입니다. 이 판결은 중재에서 절차적 명확성과 당사자 자율성을 강화합니다. 

5. 2026년 기업 준수 촉진 제도 (CCFS)

기업부는 미제출 서류, 휴면 상태 또는 자발적 말소를 위한 상당한 수수료 감면을 제공하는 기간 한정 준수 창구를 도입했습니다. 적격 기업은 추가 수수료에 대해 최대 90% 면제와 특정 처벌에 대한 면책을 받을 수 있습니다. CCFS는 보다 엄격한 집행 이전의 마지막 기회로 제시됩니다. 

6. 2020년 보도 자료 3호 개정

인도 정부는 실질적 소유권 기준을 명확히 하고, 접경국으로부터의 특정 투자에 대해 10%의 자동 승인 경로를 도입함으로써 외국인 투자 규정을 정비했습니다. 반도체와 같은 전략 산업에 대해 60일의 신속 승인 메커니즘도 도입되었습니다. 이러한 변경은 국가 안보와 투자 용이성 및 공급망 발전 간의 균형을 맞추는 것을 목표로 합니다.

Section A: Sector Updates

1. Indian semiconductor mission (ISM) 2.0 announced

The Union Budget 2026-27 announced ISM 2.0 to deepen India’s semiconductor ecosystem, with a focus on equipment, materials, and full-stack intellectual property development. Backed by USD 110 million allocation, the initiative builds on ISM 1.0’s incentive-led framework. It also emphasises industry-led research and development and skill development to strengthen domestic capabilities and global supply chain integration. 

2. Electronics components manufacturing scheme (ECM Scheme)

The ECM Scheme received a boost with an increased outlay of USD 4.4 billion, signalling a strong push toward domestic electronics manufacturing as part of the Union Budget 2026-27. The ECM Scheme prioritises component-level production, including sub-assemblies, and capital goods. It complements the semiconductor initiatives to create an integrated end-to-end electronics manufacturing ecosystem in India. 

3. Uniform consent guidelines amended under Air (Prevention and Control of Pollution) Act, 1981 and Water (Prevention and Control of Pollution) Act, 1974 

The amendments to the uniform consent guidelines streamline regulatory processes by extending validity of consent to operate until cancellation and reducing approval timelines for highly polluting industries. They also introduce deemed approvals for certain medium, small and micro enterprises (MSMEs) and shift site-specific requirements to expert authorities. The changes aim to improve ease of doing business while maintaining environmental oversight. 

4. Solid Waste Management Rules, 2026 notified

The Solid Waste Management Rules, 2026, expand applicability to rural areas and introduce mandatory 4 (four) stream waste segregation to improve efficiency and sustainability. They broaden the definition of bulk waste generators and impose stricter compliance obligations, including decentralised processing. A ‘cap-and-trade’ style extended bulk waste generator responsibility framework is also introduced to enhance accountability in waste management. 

5. Small Hydro Power Development Scheme (SHP Scheme) announced

The SHP Scheme has been approved for financial year 2026-31 with a USD 284 million outlay, and targets 1,500 (one thousand five hundred) megawatt of capacity, particularly in hilly and north-eastern regions. It provides central financial assistance and funding for project development and detailed project reports. The SHP Scheme is expected to drive investment, generate employment, and promote decentralised renewable energy. 

6. Bio-Pharma Shakti Scheme (Shakti Scheme)

With an outlay of USD 110 million over 5 (five) years, the Shakti Scheme seeks to strengthen India’s biopharmaceutical ecosystem and global competitiveness in biologics and biosimilars. It includes funding, infrastructure expansion, clinical trial networks, and regulatory strengthening. The Shakti Scheme aims to boost domestic manufacturing, innovation, and faster approvals while reducing import dependence.

Section B: General Updates

1. Foreign Exchange Management (Guarantees) Regulations, 2026

The Reserve Bank of India (RBI) has overhauled the cross-border guarantees framework by shifting from a prescriptive approval-based regime to a principle-based approach linked to the legality of the underlying transaction. The regulations introduce clear definitions and expressly permit inbound guarantees, improving regulatory clarity. A structured late submission fee mechanism has also been introduced to regularise reporting delays. 

2. Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026

The Foreign Exchange Management (Export and Import of Goods and Services) Regulations 2026, consolidate export reporting into a single export declaration form and streamline timelines across goods, services, and software. They extend export realisation timelines (up to 18 (eighteen) months for INR trade) and remove rigid import payment timelines, aligning with contractual flexibility. The framework also permits set-off between goods and services transactions and places greater responsibility on authorised dealer banks. 

3. SEBI Notified the Listing Obligations and Disclosure Requirements (Amendment) Regulations, 2026 

The amendments strengthen corporate governance by formalising disclosure of special shareholder rights and simplifying investor service processes. They eliminate intermediaries like letters of confirmation and significantly reduce processing timelines. The threshold for high value debt listed entities has also been increased, easing compliance for mid-sized entities. 

4. Supreme Court clarifies the date of commencement of arbitral proceedings under section 21

The Supreme Court clarified that arbitral proceedings commence upon receipt of a notice invoking arbitration under section 21 of Arbitration and Conciliation Act, 1996 (Arbitration Act). This position applies uniformly across the Arbitration Act, resolving prior judicial divergence. The ruling reinforces procedural clarity and party autonomy in arbitration. 

5. Companies Compliance Facilitation Scheme, 2026 (CCFS)

The Ministry of Corporate Affairs has introduced a time-bound compliance window offering significant fee waivers for pending filings, dormant status, or voluntary strike-off. Eligible companies can avail up to 90% (ninety percent) waiver on additional fees and immunity from certain penalties. The CCFS is positioned as a final opportunity before stricter enforcement action. 

6. Press Note 3 of 2020 (Press Note 3) amended

The Government of India has refined foreign investment rules by clarifying beneficial ownership thresholds and introducing a 10% (ten percent) automatic route for certain investments from land-bordering countries. A fast-track 60 (sixty) day approval mechanism has been introduced for strategic sectors like semiconductors. The changes aim to balance national security with ease of investment and supply chain development.

Indian semiconductor mission (ISM) 2.0 announced

In the Union Budget 2026-27, the Government of India announced ISM 2.0 with the objective of strengthening domestic semiconductor capabilities.[1] ISM 2.0 will focus on promoting the production of semiconductor equipment and materials in India, developing full-stack Indian semiconductor intellectual property, and strengthening domestic as well as global semiconductor supply chains. A provision of USD 110 million has been allocated for ISM 2.0 for financial year 2026–27, building further on the ISM 1.0, which was introduced in 2021 by the Government of India to develop India’s semiconductor ecosystem. The initiative also places significant emphasis on industry-led research and training centres to support technology development and build a future-ready skilled workforce. 

The detailed incentives framework under ISM 2.0 is yet to be announced by the Government of India following the announcement of the mission. ISM 1.0 mission was supported by an incentive framework of USD 8.36 billion, providing fiscal support of up to 50% (fifty percent) of project cost for silicon semiconductor fabs, compound semiconductor facilities, assembly, testing, marking and packaging (ATMP/OSAT) units, and semiconductor design.

Electronics components manufacturing scheme (ECM Scheme) 

In the Union Budget 2026-27, the Government of India announced key developments relating to the ECM Scheme.[2] The update signals a policy push towards strengthening domestic electronics manufacturing and reducing import dependency. Key aspects include:

1. Increased budgetary allocation and policy support: Increased outlay of ECM Scheme, for electronics components manufacturing to USD 4.4 billion from previous budget of USD 2.75 billion, to enhance domestic component manufacturing.
2. Stronger policy focus on component level manufacturing: The ECM Scheme enhances allocation and directs it towards the electronics manufacturing capabilities by incentivising the production of critical components, sub-assemblies and capital goods. 
3. Alignment with semiconductor and strategic electronics initiatives: The ECM Scheme is positioned as a complementary framework to broader initiatives such as the ISM 1.0 and ISM 2.0. Together, these measures seek to create an end-to-end electronics manufacturing ecosystem, ranging from semiconductors to finished goods in India, enhancing its global competitiveness.

For further information on the ECM Scheme please refer to: https://cms-induslaw.com/en/ind/publication/japan-newsletter-january-april-2025

Uniform consent guidelines amended under Air (Prevention and Control of Pollution) Act, 1981 and Water (Prevention and Control of Pollution) Act, 1974

On January 23, 2026, the Ministry of Environment, Forest and Climate Change (MoEFCC) has amended the  Control of Air Pollution (Grant, Refusal or Cancellation of Consent) Amendment Guidelines, 2026 and the Control of Water Pollution (Grant, Refusal or Cancellation of Consent) Amendment Guidelines, 2026 (together, 2025 Guidelines).[3] The 2025 Guidelines provide procedures and criteria for obtaining consent to establish or operate industrial plants that may cause air or water pollution. Key changes include, amongst others:

1. Validity of consent: As per the 2025 Guidelines, the consent to operate will remain valid until cancelled. Earlier, this was valid up to 5 (five) years. The amendments also allow the state governments to prescribe a one-time processing fee for the grant of consent to operate for 5 (five) to 25 (twenty-five) years. The processing time for granting consent to highly polluting (‘red’ category) industries has been reduced from 120 (one hundred and twenty) days to 90 (ninety) days. For micro and small enterprises located in notified industrial estates or areas, the consent to establish will be deemed granted upon the submission of a self-certified application. 
2. Site requirements: The 2025 Guidelines provide for minimum distance to be maintained by the industries from water bodies and certain other sites. The 2025 Guidelines specify that these requirements will be imposed by the expert appraisal committee or the state board.

Solid Waste Management Rules, 2026 notified

On January 27, 2026, the MoEFCC has notified the Solid Waste Management Rules, 2026 (2026 Rules). The 2026 Rules have been framed under the Environment (Protection) Act, 1986 and replace the Solid Waste Management Rules, 2016 (2016 Rules).[4] The 2026 Rules will come into effect on April 1, 2026. The Rules specify a framework for management of solid waste, and duties of various entities such as government departments, local bodies, industries, and commercial establishments. Key features of the 2026 Rules include:

1. Applicability: The 2016 Rules apply to urban local bodies, outgrowths in urban agglomerations, census towns, and industrial townships, and specified areas such as certain religious places, airports, and government establishments. The 2026 Rules extend applicability to rural local bodies.
2. 4 (four) stream segregation: The 2026 Rules introduce a mandatory 4 (four) stream segregation system requiring waste to be divided into wet, dry, sanitary, and special care categories. Wet waste is composted, dry waste is recycled through material recovery facilities (MRFs), sanitary waste is securely wrapped, and hazardous items like paint cans and medicines are handled by authorized agencies. This system improves efficiency and promotes environmentally responsible waste management.
3. Bulk waste generators: Under the 2016 Rules, bulk waste generators include entities with average waste generation of more than 100 (one hundred) kg per day (except residential societies). The 2026 Rules expand the definition of bulk waste generators to include entities with: (i) floor area of at least 20,000 (twenty thousand) square meters, or (ii) water consumption of at least 40,000 (forty thousand) litres per day. The 2026 Rules also cover residential societies. Bulk waste generators will have certain obligations such as: (i) registering with the concerned local body, (ii) making necessary arrangements for segregation of waste, and (iii) decentralised processing of wet waste. 
4. EBWGR certificates: The 2026 Rules have introduced a ‘cap-and-trade’ style mechanism for solid waste through introduction of extended bulk waste generator responsibility (EBWGR). Under this framework, bulk waste generators are held accountable for the waste they produce and will be required to: (a) process wet waste on-site wherever feasible; (b) obtain an EBWGR certificate if on-site processing is not possible; and (c) ensure environmentally sound collection, transportation, and processing of all waste generated.
5. Management of horticultural waste and agri-residue: The 2026 Rules have introduced that local bodies must facilitate establishment of facilities for collection and storage of agri-residue. The local bodies must ensure that such waste is not burned openly.

Small hydro power development scheme announced

On March 18, 2026, the Union Cabinet approved the Small Hydro Power (SHP) Development Scheme (SHP Scheme) for the period financial years 2026-27 to 2030-31, with a total outlay of USD 284 million for installation of SHP projects with an aggregate capacity of approximately 1,500 (one thousand five hundred) megawatts.[5] The SHP Scheme aims to promote development of SHP projects (1 (one) to 25 (twenty-five) megawatts) across states, with a focus on hilly and north-eastern regions. Key aspects of the SHP Scheme include:

1. Central financial assistance (CFA): In north-eastern states and districts with international borders, CFA of USD 396,000 per megawatt or 30% (thirty percent) of project cost (whichever is lower), subject to a cap of USD 3.3 million per project, will be provided. In other states, CFA of USD 264,000 per megawatt or 20% (twenty percent) of project cost (whichever is lower), subject to a cap of USD 2.2 million per project will be accessible.
2. Allocation for project support: An amount of USD 278.5 million has been earmarked for implementation of SHP projects under the SHP Scheme.
3. Pipeline development: The SHP Scheme provides for preparation of detailed project reports for approximately 200 (two hundred) projects, with USD 3.3 million allocated for this purpose to support state and central agencies.
4. Investment and employment impact: The SHP Scheme is expected to generate an investment of approximately USD 1.65 billion in the small hydro sector and along with generating significant employment during construction and promoting decentralised renewable energy development in remote areas.

Container manufacturing assistance scheme announced

In the Union Budget 2026-27, the Government of India announced the launch of the Container Manufacturing Assistance Scheme (CMA Scheme).[6] The CMA Scheme is aimed at developing a globally competitive domestic container manufacturing industry with a budget allocation of USD 1.1 billion. The CMA Scheme is spread out over 5 (five) years and targets an annual domestic manufacturing capacity of approximately 1 (one) million twenty-foot equivalent units (TEUs) over the next decade. The CMA Scheme aims to support establishment of a globally competitive container manufacturing ecosystem in India, supporting the rapid growth of containerised cargo, which accounts for nearly two-thirds of the value of international trade.

Bio-pharma shakti scheme announced

In the Union Budget 2026-27, the Government of India announced the Bio-Pharma Shakti Scheme (Shakti Scheme) with an outlay of USD 110 million over a period of 5 (five) years, with the objective of strengthening the domestic biopharmaceutical sector and enhancing India’s global competitiveness in biologics and biosimilars.[7] The Shakti Scheme is aimed at building a globally competitive ecosystem supporting affordable healthcare, and positioning India as a global bio-pharma manufacturing and innovation hub. Key benefits in the Shakti Scheme include:

1. Components of the Shakti Scheme: The Shakti Scheme aims to focus on the: (i) Biopharma Discovery Grant Fund & Discovery & Development Equity Fund; (ii) Biopharma-focused NIPER Network and National Biopharma Research and Development Network; (iii) India Clinical Trial Sites Network (1,000 (one thousand) accredited sites); (iv) Fermentation-based Bulk Drugs & Building Blocks Manufacturing Incentive; (v) Biopharma Delivery Devices & Packaging Manufacturing Ecosystem; (vi) Biosimilars & Emerging Biologics Manufacturing Initiative; and (vii) Regulatory Strengthening for Global-best Drug Review Standards and Approval Timeframes
2. Promotion of domestic manufacturing and reduced import dependence: The Shakti Scheme, similarly to Production Linked Incentive (PLI) Scheme for pharmaceuticals or the Bulk drug park scheme, aims to support the domestic development and manufacturing of high-value biopharmaceutical products and medicines, reduce reliance on imports, and enhance India’s integration and competitiveness in the global biologics supply chain.
3. Strengthening human capital through institutional expansion: The initiative provides for the establishment of 3 (three) new National Institutes of Pharmaceutical Education & Research (NIPERs) and the upgradation of 7 (seven) existing NIPERs, with a view to addressing the increasing demand for specialised human resources in biopharma research, development, manufacturing, and regulatory functions.
4. Development of clinical research ecosystem: The Shakti Scheme envisages the creation of a large-scale clinical research ecosystem, with a focus on enhancing India’s capacity to conduct advanced and globally benchmarked clinical trials.
5. Regulatory strengthening and faster approvals: The Central Drugs Standard Control Organisation is proposed to be reinforced through the creation of a dedicated scientific review cadre, aimed at strengthening the regulatory framework and enabling faster, globally credible approvals, thereby reducing approval timelines.

Foreign Exchange Management (Guarantees) Regulations, 2026

On January 12, 2026, the RBI notified the Foreign Exchange Management (Guarantees) Regulations, 2026 (New Regulations), replacing and superseding Foreign Exchange Management (Guarantees) Regulations, 2000 (Erstwhile Regulations).[8] Key provisions include:

1. Regulatory shift: The New Regulations provide that a person resident in India may be a party, whether as a principal debtor, surety or creditor, to a guarantee involving a person resident outside India only in accordance with the conditions prescribed thereunder. Under the Erstwhile Regulations, there was a general restriction on guarantees involving a person resident outside India. However, the regulations carved out specific situations in which such guarantees were permitted without prior approval of RBI, which included, among others, guarantees linked to structured obligations under the external commercial borrowing framework, guarantees issued by authorised dealer (AD) banks, and certain guarantees by other resident entities. Transactions falling outside these specified categories generally required prior RBI approval, resulting in a relatively transaction-specific and prescriptive regulatory approach.

In contrast, the New Regulations adopt a more principle-based framework, the regulations generally allow residents to participate in cross-border guarantees provided that: (a) the underlying transaction is not prohibited under the Foreign Exchange Management Act, 1999, and (b) the parties satisfy the lending and borrowing eligibility conditions prescribed under the Foreign Exchange Management (Borrowing and Lending) Regulations, 2018. Accordingly, the permissibility of a guarantee is now largely linked to the legality of the underlying cross-border financial arrangement and the eligibility of the parties involved, rather than being confined to a narrow set of predefined categories. 

1. Clarity in definitions: The Erstwhile Regulations lacked detailed definitions, leaving key terms such as ‘guarantee’ and ‘surety’ open to interpretation. The New Regulations address this by expressly defining ‘guarantee’, ‘surety’, ‘principal debtor’, and ‘creditor.’ Notably, ‘guarantee’ is defined broadly to include any contract to discharge a debt, obligation or other liability (including a portfolio of liabilities) upon default by the principal debtor and expressly includes counter-guarantees.
2. Late submission fee for delayed reporting: Under the Erstwhile Regulations, there was no explicit provision for regularising delayed or missed reporting of guarantees through a structured late submission fee mechanism. According to the New Regulations, a person resident in India who fails to comply with the reporting requirements may regularise the delay by completing the required reporting and paying a late submission fee. The late submission fee is calculated as USD 82.5 plus 0.025% (zero point zero two five percent) of the amount involved, multiplied by the period of delay (rounded to the nearest month), with the final amount rounded up to the nearest hundred.

Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026

The RBI, on January 13, 2026, notified the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 (2026 Regulations), replacing the Foreign Exchange Management (Export of Goods & Services) Regulations, 2015 (Existing Regulations), effective from October 01, 2026.[9] Key changes include:

1. Uniform reporting: The 2026 Regulations consolidate the declaration requirements for exports of goods, services, and software into a single export declaration form (EDF), replacing the earlier framework under which an EDF was required for export of goods and a ‘SOFTEX’ form for software exports. Under the 2026 Regulations, software is treated as a form of ‘service’.
2. Timeline for submission of EDF: 

1. Import payment and export realizations: The earlier 6 (six) month timeline for import payments has been removed, and payments must now follow the contractual terms agreed between parties. For export proceeds, the realisation period has been extended from 9 (nine) months to 15 (fifteen) months (from the date of shipment for goods and the date of invoice for services), giving businesses more time to receive payments. For exports invoiced or settled in INR, the realisation period has been further extended to 18 (eighteen) months to encourage INR denominated trade.
2. Import and export transactions set-off: Under the Existing Regulations, set-off of payments pertaining to goods against services is not allowed. However, set-off of export receivables for goods against import payables for services, and vice versa, will now be permitted under the 2026 Regulations. Such set offs may be carried out with the same overseas counterparty or its group or associate companies, within the prescribed export realisation period or any extended period approved by the authorised dealer bank.
3. Responsibilities of authorised dealer banks: Under the 2026 Regulations, greater responsibility is placed on the authorised dealer banks based on their internal policies and assessment of the bona fides of each transaction. The 2026 Regulations direct the authorised dealer banks to formulate an internal policy and standard operating procedures for handling trade transactions and reporting them.

SEBI Notified the Listing Obligations and Disclosure Requirements (Amendment) Regulations, 2026 

On January 22, 2026, SEBI notified the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2026 (LODR Amendment), introducing a series of targeted reforms to the existing disclosure and governance framework applicable to listed entities.[10] The amendments are aimed at enhancing the quality of corporate governance, strengthening transparency in shareholder rights, and streamlining investor servicing processes. Key amendments are:

1. Enhanced disclosure and governance of special shareholder rights: The LODR Amendment introduces a formalised framework governing the disclosure of special rights granted to certain shareholders. Listed entities are now required to ensure that such rights are transparently disclosed and are subject to periodic approval by shareholders, thereby reinforcing equitable treatment and preventing disproportionate control structures.
2. Simplification of investor service request processes: The LODR Amendment significantly streamlines procedures relating to investor service requests, including issuance of duplicate share certificates, transmission of securities, and related processes. The amendments reduce procedural complexity and reliance on documentation, thereby improving efficiency in handling such requests.
3. Removal of requirement for letters of confirmation (LOC): The requirement to issue LOCs in several cases has been largely dispensed with. Registrars and transfer agents (RTAs) are now permitted to directly credit securities to the demat accounts of investors upon completion of necessary due diligence, eliminating intermediate steps in the process.
4. Reduction in processing timelines for investor requests: As a consequence of the procedural simplifications, the timeline for processing investor service requests is expected to reduce significantly from approximately 150 (one hundred and fifty) days to around 30 (thirty) days, thereby improving investor experience and reducing associated risks.
5. Revision of threshold for high value debt listed entities: The amendments increase the identification threshold for high value debt listed entities from USD 110 million to USD 550 million. This change is expected to provide compliance relief to mid-sized non-banking financial companies and asset reconstruction companies, while aligning governance standards with those applicable to equity-listed entities.

SEBI introduces revised reporting framework for Alternative Investment Funds (AIFs)

The SEBI has, vide circular dated March 4, 2026, introduced a revised regulatory reporting framework for AIFs, aimed at streamlining reporting requirements and improving regulatory oversight. The circular provides:

1. Standardised reporting requirement: AIFs are now required to submit a detailed annual activity report capturing operational, financial, and investor-related data, within 30 (thirty) calendar days from the end of March, every financial year. Further, AIFs are also required to file a quarterly activity report, within 15 (fifteen) days from the end of each quarter, except for the quarter ending in March each year. 
2. Digitisation of compliance processes: Reporting is required [SC1] to be undertaken through SEBI’s online intermediary portal, enhancing regulatory efficiency and reducing manual compliance burdens.
3. Enhanced regulatory visibility: The framework enables SEBI to monitor fund activities, investment trends, and compliance in a more granular manner.

Supreme Court clarifies the date of commencement of arbitral proceedings under section 21

In Regenta Hotels Pvt. Ltd. v. Hotel Grand Centre Point & Ors.,[11] the Supreme Court of India authoritatively reaffirmed the precise moment at which arbitral proceedings commence. Arbitration proceedings commence on the date the respondent receives a notice invoking arbitration under section 21 of the Arbitration and Conciliation Act, 1996 (Arbitration Act). This definition applies uniformly across all provisions of the Arbitration Act, not merely for the purposes of limitation under section 43, unless expressly excluded by a specific provision. Prior to this ruling, there was divergent judicial opinion on whether arbitration commences when a petition for appointment of an arbitrator is filed before a court, or when arbitration is formally invoked by notice. The Supreme Court further held that the legislature deliberately de-linked commencement from judicial proceedings in order to ensure clarity and promote party autonomy. 

Person ineligible under section 12(5) cannot nominate another arbitrator

In Bhadra International (India) Pvt. Ltd. v. Airports Authority of India,[12] the Supreme Court held that a person ineligible to be an arbitrator due to compromised independence or impartiality as per section 12(5) read with the seventh schedule to the Arbitration Act, cannot validly nominate or appoint another person as arbitrator. The Supreme Court affirmed that the principle of equal treatment under section 18 applies not only to arbitral proceedings but also to the procedure for constituting the arbitral tribunal. Any unilateral appointment by one party where that party has exclusive power to appoint a sole arbitrator violates impartiality and neutrality. The ruling further confirmed that an arbitrator's mandate is automatically terminated when they are found ineligible under section 12(5) of the Arbitration Act, and that an aggrieved party may approach the Courts under sections 14 and section 15 of the Arbitration Act for appointment of a substitute, or under section 34 of the Arbitration Act to set aside the resulting award. 

Pre-award interest cannot be awarded if contract prohibits it 

In Union of India & Ors. v. Larsen & Toubro Limited,[13] the Supreme Court set aside the grant of pre-award (pendente lite) interest by the arbitral tribunal where the contract expressly prohibited such interest. Under section 31(7)(1) of the Arbitration Act, an arbitral tribunal cannot award pre-award interest in the form of ‘compensation’ when the contract expressly bars such award. In this case, the arbitral tribunal had awarded USD 608,300 to Larsen and Toubro, including amounts resembling interest despite clause 64(5) of the contract prohibiting interest until the date of the award. The Supreme Court ruled that this award was impermissible and set aside the pre-award interest.

Limited scope of interference with arbitral awards

In Municipal Corporation of Greater Mumbai v. M/s R.V. Anderson Associates Ltd.,[14] the Supreme Court upheld the dismissal of a challenge under section 34 of the Arbitration Act, reaffirming the limited scope of interference with arbitral awards. The Supreme Court rejected the appellant’s challenge on jurisdictional grounds and upheld the arbitral award, emphasising that courts cannot interfere unless the award suffers from patent illegality or falls within the narrow statutory grounds under sections 34 and section 37 of the Arbitration Act. The judgment reinforces the principle that arbitral awards are final and binding, and judicial review cannot be used to revisit findings on merits. 

Union Budget 2026–27 and the new Income-tax Act, 2025 to come into force from April 1, 2026

On February 1, 2026, Union Budget 2026–27 (Budget) was presented in the Parliament. The key direct tax announcement in the Budget is the introduction of the Income Tax Act, 2025 (New Act), which will replace the Income Tax Act, 1961 with effect from April 1, 2026 (i.e., from tax year 2026–27). The New Act comprehensively modernises India's direct tax framework with simplified language, restructured provisions, and redesigned forms, although the detailed rules and forms under the New Act are to be notified gradually over subsequent months. The key direct tax proposals in the Budget include:

1. No change in personal income tax slabs or rates for the assessment year 2026–27: These remain unchanged from the previous year. The tax-free threshold under the new tax regime was also retained at the levels announced in the Union Budget for 2025-2026.
2. Extended deadline for revised returns: The due date for filing revised income tax returns has been extended from December 31 to March 31 of the relevant assessment year, subject to payment of a nominal late fee.
3. Staggered filing deadlines: Salaried taxpayers must now file their returns by July 31, while non-audit business taxpayers have until August 31.
4. Minimum alternate tax (MAT) reduction: MAT is proposed to be reduced from 15% (fifteen percent) to 14% (fourteen percent) with effect from tax year 2026–27.
5. Revised buyback taxation: Buyback proceeds for all categories of shareholders will be taxed as capital gains (not as dividend in the hands of the company), with promoters bearing an additional buyback tax resulting in an effective rate of 22% (twenty-two percent) for corporate promoters and 30% (thirty percent) for non-corporate promoters. This change applies from March 1, 2026.
6. Foreign Assets Disclosure Scheme, 2026: A one-time, 6 (six) month voluntary disclosure window has been introduced for eligible small taxpayers including students, young professionals, and returning non-resident Indians, which aims to regularise limited foreign assets that were not previously disclosed. For assets and income not exceeding USD 110,000, taxpayers must pay 30% (thirty percent) of the undisclosed value plus 100% (one hundred percent) additional tax; for cases where foreign assets were not declared (before becoming a resident), a fee of USD 1,100 applies where the default does not exceed USD 550,000.
7. Safe harbour for IT services: The revenue threshold for availing safe harbour pricing for information technology (IT) and IT-enabled services (including software development, KPO, and contract research and development relating to software development, now clubbed as a single 'IT Services' category) is enhanced from USD 33 million to USD 220 million. An automated, rule-driven approval process for safe harbour elections is also introduced, valid for up to 5 (five) consecutive years.
8. Tax holiday for foreign cloud service providers: Foreign companies providing cloud services to global customers using data centre infrastructure located in India are eligible for a tax holiday on India-sourced income until 2047, with a safe harbour of 15% (fifteen percent) on cost for related-party data centre arrangements.
9. Portfolio investment scheme liberalisation: Persons resident outside India (PROI) may now invest in listed Indian equities through the portfolio investment scheme up to a limit of 10% (ten percent) of the paid-up share capital of an Indian company, a significant expansion of the existing framework.
10. Tax holiday for International Financial Services Centre (IFSC): Tax holiday extended from 10 (ten) out of 15 (fifteen) tax years to 20 (twenty) out of 25 (twenty-five) tax years, with a post-holiday tax rate of 15% (fifteen percent) in the IFSC, reinforcing India's position as a global financial hub.

Companies Compliance Facilitation Scheme 2026 (CCFS)

On February 24, 2026, the Ministry of Corporate Affairs (MCA) issued a circular introducing the Companies Compliance Facilitation Scheme, 2026 (CCFS-2026), operative for a strict, non-extendable 3 (three) month window between April 15, 2026, and July 15, 2026.[15] The CCFS-2026 has been framed as a relief measure for MSMEs, one person company(s), and other entities which were previously burdened by the uncapped USD 1.1 per day additional fee for any missed statutory filings, since July 1, 2018. The CCFS-2026 provides eligible companies with 3 (three) options:

1. Pending annual filings at 10% (ten percent) of total additional fees: Companies with overdue statutory filings can file pending e-forms during the CCFS-2026 window by paying the normal filing fee plus only 10% (ten percent) of the applicable additional fees, effectively granting a 90% (ninety percent) waiver on late fees.
2. Dormant company status at 50% (fifty percent) of normal fee: Inactive companies wishing to retain corporate registration with minimal ongoing compliance obligations can apply for dormant status under section 455 of the Companies Act, 2013 by filing e-Form MSC-1, with 50% (fifty percent) of the prescribed filing fee payable.
3. Voluntary strike-off at 25% (twenty-five percent) of normal fee: Companies seeking voluntary strike-off under section 248 of the Companies Act can file e-Form STK-2 during the CCFS-2026 period and will be required to pay only 25% (twenty-five percent) of the standard filing fee.

Companies filing within the window also receive immunity from penal proceedings under sections 92 and 137 of the Companies Act, 2013, subject to no adjudication order having been passed prior to the CCFS-2026. The CCFS-2026 excludes companies already served final strike-off notices, those that have applied for strike-off or dormant status, dissolved companies, and vanishing companies. The MCA has indicated this is a final opportunity, with Registrars of Companies directed to initiate enforcement action against all remaining defaulters upon the CCFS-2026’s conclusion.

Press Note 3 of 2020 (Press Note 3) amended

On March 10, 2026, the Government of India introduced key refinements to its foreign investment and manufacturing framework, with a particular focus on electronics and semiconductor supply chains. The amendments to Press Note 3,[16] inter alia, provide for the following:

1. Clarification of beneficial ownership thresholds: Beneficial ownership has now been aligned with the framework under the Prevention of Money Laundering Act, 2002, providing a clear and uniform benchmark for determining ownership and control in cross-border investments. 
2. Introduction of 10% (ten percent) threshold for automatic route eligibility: Investments involving up to 10% (ten percent) beneficial ownership from land-bordering jurisdictions may proceed under the automatic route (subject to no control rights), thereby easing investment inflows into electronics and semiconductor sectors. 
3. Time-bound approval mechanism: A 60 (sixty) day fast-track approval route has been introduced for investments in strategic sectors, including semiconductor manufacturing and electronic components, improving deal certainty and execution timelines. 
4. Enhanced reporting obligations: Investors are required to disclose beneficial ownership details to Department for Promotion of Industry and Internal Trade of India, strengthening regulatory oversight without materially increasing friction. 

For more details on the amendment to the Press Note 3 please refer: https://cms.law/en/sgp/legal-updates/decoding-investment-into-india-for-land-border-countries

1. Several South Korean insurers are exploring entry into the Indian insurance market following regulatory reforms permitting full foreign ownership in the sector. Companies reported to be evaluating potential entry include (i) Samsung Fire & Marine Insurance, (ii) Hyundai Marine & Fire Insurance, and (iii) Mirae Asset Financial Group. These companies are assessing opportunities in India’s insurance industry, particularly in motor, health, and life insurance segments, and have initiated preliminary discussions with advisors and market participants to evaluate possible investment structures or partnerships. The interest follows policy changes that have made the Indian insurance sector more accessible to foreign insurers.
2. Gabriel India Limited completed a joint venture with South Korean automotive fastener manufacturer Jinos Co., Ltd. on February 27, 2026. The partnership has been established through Jinhap Gabriel Auto India Private Limited, with Gabriel India holding 51% (fifty-one percent) equity and Jinos holding 49% (forty-nine percent), making the entity a subsidiary of Gabriel India. The joint venture will focus on the engineering, development, manufacturing, and distribution of fasteners for automotive and industrial applications in India, covering activities across the value chain including import, export, assembly, marketing, and sales. The closing follows an initial proposal announced in July 2025 after the completion of necessary conditions and allotment of shares in the agreed equity ratio.
3. Wipro Limited has expanded its presence in South Korea with the launch of a new innovation lab in Seoul and an enlarged office footprint, reinforcing the market as a strategic growth hub. The lab, part of its global innovation network, will focus on artificial intelligence led digital transformation across sectors such as automotive, industrial manufacturing and technology, enabling co-creation with clients. The expansion also includes plans to scale local talent and deepen collaboration with academic institutions, reflecting rising demand from South Korean enterprises for advanced engineering and digital solutions and positioning Korea as a key node in Wipro’s global delivery network.
4. JNK India Limited has secured a ‘major’ category order from its promoter entity, JNK Global Co., Ltd. (Korea), for a refinery project in India, with the contract value estimated in the range of USD 33 million to USD 66 million. The scope includes support services and supply for a cracker furnace package, and the project is scheduled for completion by February 2028, indicating a multi-year execution timeline. The transaction qualifies as a related-party deal, though the company has stated it is being undertaken on an arm’s length basis, and is expected to strengthen JNK India’s order book and visibility in the refinery and petrochemical infrastructure segment.

[1] Press Information Bureau, Government of India, Budget 2026–27 announces the launch of India Semiconductor Mission (ISM) 2.0; increased outlay for Electronics Components Manufacturing Scheme; new safe harbour provisions for IT/ITeS, February 1, 2026, https://www.pib.gov.in/PressReleasePage.aspx?PRID=2221522&reg=3&lang=1, last accessed April 6, 2026.

[2] Press Information Bureau, Government of India, Electronics Components Manufacturing Scheme – Union Budget 2026–27 raises scheme outlay to INR 40,000 crore, February 3, 2026, https://www.pib.gov.in/PressReleasePage.aspx?PRID=2222519&reg=3&lang=2, last accessed April 6, 2026.

[3] The Government of India, Ministry of Environment, Forest and Climate Change, Government amends Uniform Consent Guidelines under Air and Water Acts to streamline approvals, reduce delays and strengthen environmental compliance, 28 January 2026, https://www.pib.gov.in/PressReleasePage.aspx?PRID=2219415&reg=3&lang=1 (last accessed: 6 April 2026).

[4] The Government of India, Ministry of Environment, Forest and Climate Change, Solid Waste Management Rules, 2026, 28 January 2026, Access Document (last accessed: 6 April 2026).

[5] Press Information Bureau, Cabinet, “Cabinet approves ‘Small Hydro Power (SHP) Development Scheme for the period FY 2026–27 to FY 2030–31’”, March 18, 2026, available at: https://www.pib.gov.in/PressReleasePage.aspx?PRID=2241799&reg=3&lang=1 (last accessed on April 7, 2026).

[6] Press Information Bureau, Ministry of Ports, Shipping and Waterways, “20 New National Waterways and Coastal Cargo Promotion Scheme Announced”, April 2026, available at: Press Release (last accessed on April 7, 2026).

[7] Press Information Bureau, Ministry of Chemicals and Fertilizers (Department of Pharmaceuticals), “Biopharma SHAKTI Scheme”, March 17, 2026, available at: Press Release (last accessed on April 7, 2026).

[8] Reserve Bank of India, Notification No. RBI/2025-26 (as per NotificationUser.aspx ID 13269), January 12, 2026, https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13269&Mode=0, last accessed April 6, 2026.

[9] Reserve Bank of India, Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 (Notification No. FEMA 23(R)/2026-RB), January 13, 2026, https://www.pdicai.org/Docs/Notification-No-FEMA-23-R-2026-RB_1912026103415524.pdf, last accessed April 6, 2026.
 

[10] Securities and Exchange Board of India, “Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2026”, January 20, 2026 (published January 22, 2026), available at: https://www.sebi.gov.in/legal/regulations/jan-2026/securities-and-exchange-board-of-india-listing-obligations-and-disclosure-requirements-amendment-regulations-2026_99336.html (last accessed on April 7, 2026).

[11] Regenta Hotels Pvt. Ltd. v. Hotel Grand Centre Point & Ors. 2026 SCC OnLine SC 35.

[12] Bhadra International (India) Pvt. Ltd. v. Airports Authority of India (2017) 10 SCC 706 (Supreme Court of India).

[13] Supreme Court of India, Union of India & Ors. v. Larsen & Toubro Limited, 2026 LiveLaw (SC) 214; 2026 INSC 203, February 27, 2026, https://www.livelaw.in/sc-judgments/2026-livelaw-sc-214-union-of-india-ors-versus-larsen-tubro-limited-lt-525619, last accessed April 6, 2026.

[14] Municipal Corporation of Greater Mumbai v. M/s R.V. Anderson Associates Limited, Supreme Court of India, judgment dated March 11, 2026, available at: https://www.livelaw.in/sc-judgments/2026-livelaw-sc-235-municipal-corporation-of-greater-mumbai-versus-ms-rv-anderson-associates-limited-526207 (last accessed on April 7, 2026).

[15] Ministry of Corporate Affairs, Companies Compliance Facilitation Scheme, 2026 (General Circular No. 01/2026), February 25, 2026, https://avantiscdnprodstorage.blob.core.windows.net/legalupdatedocs/53044/Companies-Compliance-Facilitation-Scheme-2026-February252026.pdf, last accessed April 6, 2026.

[16] Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry, Press Note 1 (2026 Series) – Review of FDI Policy on Insurance Sector, March 2026, https://www.dpiit.gov.in/static/uploads/2026/03/b9da5830b052c2f2d788593e97d07c63.pdf, last accessed April 6, 2026.