India opens inventory e-commerce to FDI, but exports only

The government on 23 July opened a long-shut door, but only a crack. Through Press Note 3 of the 2026 series, the DPIIT now permits foreign direct investment in the inventory-based model of e-commerce, restricted purely to the export of goods manufactured or produced in India.

Until now, foreign-funded platforms could not own inventory in India, only run marketplaces connecting third-party sellers. The new clause, tied to the Foreign Trade Policy 2023 and FEMA export rules, lets them buy directly from Indian manufacturers, hold stock and ship it abroad through their own supply chains. The ban on foreign-funded inventory retail for the domestic market stays fully in place.

Amazon and Walmart-owned Flipkart are the clear beneficiaries. Amazon welcomed the move, saying it helps tier 2 and tier 3 manufacturers reach global buyers and build Brand India. The Confederation of All India Traders and think tank GTRI struck a warier note, warning that without strict monitoring the export-only carve-out could leak into domestic inventory retail.

For D2C and MSME exporters, this could mean platforms warehousing and exporting your stock under their logistics, shortening the path to overseas customers. The trade-off is control: watch how much say platforms take over export pricing, margins and demand data. Nothing changes for selling inside India, where the marketplace-only rule for foreign capital still holds.