Important

Policy Changes

India eases FDI rules on inventory-based e-commerce, but only for exports

Last Updated: July 24, 2026

Max

July 23, 2026

6 min

Summarize with AI

COO at Nova Analytics

Max leads operations at Nova Analytics, helping Amazon sellers optimize their business performance through data-driven insights and strategic automation.

Quick Summary

•India relaxes FDI on inventory-based e-commerce, but only for the export flow
•Amazon and Walmart can now consolidate Indian-made inventory and ship directly abroad
•Amazon targets $20B of exports out of India by 2027
•Action: screen top 30 ASINs for India-viable categories, get 2 supplier quotes, model the switch in a per-ASIN P&L

Nova surfaces every Amazon fee, refund, and margin shift in your live P&L, across 21 marketplaces. View it in Nova

The 3-line summary

India eased its foreign direct investment rules on Wednesday for inventory-based e-commerce, but only when the goods are exported. The relaxation removes a long-standing block that kept Amazon, Walmart and other foreign platforms from holding and shipping Indian inventory abroad (The Star, July 23, 2026).

India's Ministry of Commerce framed the change as an export enabler, targeting an unlocked lane of locally made goods that foreign platforms can now source and ship directly to overseas buyers (The Hindu BusinessLine, July 23, 2026). Amazon has publicly committed to $20B of exports out of India by 2027.

Why it changes seller economics

Under the old rule, foreign platforms could only run a "marketplace" model in India, matching buyers to third-party inventory. That constraint made it hard to build the kind of consolidated export supply chain (private-label sourcing, quality control, pooled warehousing, batch shipping) that already runs Amazon's US and EU cross-border flows.

For US and EU-based Amazon sellers, this opens two doors over the next 12 months: cheaper access to Indian-made SKUs at consolidated freight, and a real second-sourcing option for categories currently dependent on China.

The 90-day plan

Screen your top 30 ASINs for India-viable categories - textiles, home, kitchen, wellness, non-electronic accessories, handcrafted goods. Anything with a real Made-in-India supply base.
Get a first-pass landed-cost quote from two Indian suppliers per shortlisted SKU. Compare against your current China cost, add realistic freight and duty.
Model the switch on 2-3 SKUs in your Live P&L. A second source that lands within 5% of your current cost is a strategic hedge; a source that lands cheaper is an upgrade.

How Nova helps

Live P&L - compare per-unit contribution margin between a China-sourced baseline and an India-sourced scenario on the same ASIN, holding price constant.
Multi-marketplace analytics - keep a single P&L view across US, EU and future India-sourced SKUs.

Frequently Asked Questions

Common questions about this topic

India's Ministry of Commerce relaxed the foreign direct investment rules on inventory-based e-commerce, but only when the goods are exported. Foreign platforms like Amazon and Walmart can now hold Indian-sourced inventory in India and ship it directly to overseas buyers, a model that was previously blocked.

No. The domestic e-commerce restriction still stands: foreign platforms can only run a marketplace model for Indian buyers, matching them to third-party sellers. Only the export flow is now open to a direct inventory model.

Textiles, home, kitchen, wellness, non-electronic accessories and handcrafted goods have the deepest India supply bases. Anything with a clear Made-in-India origin, modest labor content and stable specifications is worth a first-pass quote from two suppliers to compare against your current China landed cost.

Verified Sources

All information verified from official Amazon sources and trusted industry analysts as of publication date.