Schedule I explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Serial number 15.3 of the sectoral Table in Schedule I to the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 governs foreign investment in single brand product retail trading (SBRT). The cap is hundred per cent and the route is automatic. The weight of the entry is in the conditions: what a "single brand" is, the 30 per cent local sourcing norm above 51 per cent foreign investment, and when online retail may begin. The Rules are made under clauses (aa) and (ab) of sub-section (2) of section 46 of the Foreign Exchange Management Act, 1999.
This article states the position as per the Rules notified on 17 October 2019 (S.O. 3732(E)) as amended by the notifications named in this article; the latest amendment consulted is S.O. 4870(E) dated 2 September 2026. Later amendments, press notes and sector regulators' conditions should be checked before acting. A foreign brand opening its own stores can use our Indian subsidiary service.
Single brand product retail trading: hundred per cent, "Automatic". Products must be of a single brand, sold under the same brand internationally and branded during manufacturing. Where foreign investment goes beyond 51 per cent, 30 per cent of the value of goods procured must be sourced from India, met first as a five-year average and then annually. Sourcing from India for global operations may be set off. Online retail may start before stores open, if stores open within two years.
The entry after the amendments
| Serial number | Sector or activity | Sectoral cap | Entry route |
|---|---|---|---|
| 15.3 | Single Brand Product Retail Trading. Foreign investment in SBRT is aimed at attracting investments in production and marketing, improving the availability of such goods for the consumer, encouraging increased sourcing of goods from India and enhancing competitiveness of Indian enterprises through access to global designs, technologies and management practices | Hundred per cent | Automatic |
| 15.3.1 | Other conditions (a) to (g) and Notes (1) to (3) | - | - |
The Table prints the cap as a percentage figure; it is written in words throughout this article.
Which notification changed what
| Provision | Change | Notification |
|---|---|---|
| 15.3, column (4), Entry Route | Substituted by "Automatic." | Foreign Exchange Management (Non-debt Instruments) (Amendment) Rules, 2019, S.O. 4355(E) dated 5 December 2019, clause 6, item (vi) |
| 15.3.1 (e), (f), (g) | Substituted | Same notification, clause 6, item (vii) |
| 15.3.1, Note (3) | Words "or start of online retail, whichever is earlier" inserted after "first store" | Foreign Exchange Management (Non-debt Instruments) (Second Amendment) Rules, 2020, S.O. 1374(E) dated 27 April 2020, clause 4, item (i) |
| 15.3 (activity and cap), 15.3.1 (a) to (d), Notes (1) and (2) | As notified on 17 October 2019 | None of the 19 amending notifications up to 2 September 2026 changes them |
Commencement. S.O. 4355(E) was deemed to have come into force on 17 October 2019, except certain items of its clause 6 which came into force on publication. Item (vi), the route, is not among the excepted items; item (vii), the sourcing conditions, is. As notified in October 2019 the route cell read automatic up to 49% and Government route beyond 49%.
Conditions (a) to (d): what "single brand" requires
(a) Products to be sold should be of a "Single Brand" only.
(b) Products should be sold under the same brand internationally, that is, in one or more countries other than India.
(c) Single brand product retail trading covers only products which are branded during manufacturing.
(d) A person resident outside India, whether owner of the brand or otherwise, is permitted to undertake single brand product retail trading in the country for the specific brand, either directly by the brand owner or through a legally tenable agreement executed between the Indian entity undertaking SBRT and the brand owner.
Condition (e): the 30 per cent sourcing norm
In respect of proposals involving foreign investment beyond 51 per cent, sourcing of 30 per cent of the value of goods procured shall be done from India, preferably from MSMEs, village and cottage industries, artisans and craftsmen, in all sectors.
- Certification. The quantum of domestic sourcing is self-certified by the company and subsequently checked by statutory auditors from the duly certified accounts the company is required to maintain.
- First period. The requirement is to be met in the first instance as an average of five years' total value of goods procured, beginning 1st April of the year of commencement of SBRT business, that is, opening of the first store or start of online retail, whichever is earlier.
- Thereafter. The SBRT entity must meet the 30 per cent local sourcing norm on an annual basis.
- Relevant entity. The company incorporated in India which is the recipient of foreign investment for the purpose of carrying out single brand product retail trading.
Condition (f): what counts and what may be set off
All procurements made from India by the SBRT entity for that single brand are counted towards local sourcing, irrespective of whether the goods procured are sold in India or exported.
The SBRT entity is also permitted to set off sourcing of goods from India for global operations against the mandatory 30 per cent. "Sourcing of goods from India for global operations" means the value of goods sourced from India for global operations for that single brand (in INR terms) in a particular financial year, directly by the entity undertaking SBRT or its group companies (resident or non-resident), or indirectly by them through a third party under a legally tenable agreement.
Condition (g): stores and online retail
An SBRT entity operating through brick and mortar stores can also undertake retail trading through e-commerce. Retail trading through e-commerce can also be undertaken prior to opening of brick and mortar stores, subject to the condition that the entity opens brick and mortar stores within two years from the date of start of online retail.
The three Notes
(1) Conditions (b) and (d) are not applicable for undertaking SBRT of Indian brands.
(2) Indian brands should be owned and controlled by resident Indian citizens and/or companies which are owned and controlled by resident Indian citizens.
(3) Sourcing norms are not applicable up to three years from commencement of the business, that is, opening of the first store or start of online retail, whichever is earlier, for entities undertaking SBRT of products having "state-of-art" and "cutting-edge" technology and where local sourcing is not possible. Thereafter condition (e) applies. A Committee under the Chairmanship of Secretary, DPIIT, with representatives from NITI Aayog, the concerned Administrative Ministry and independent technical expert(s), examines the claim that the products are of that nature and that local sourcing is not possible, and gives recommendations for such relaxation.
The Rules print nothing more about how that Committee is approached or how long it takes.
Links to the other trading entries
A wholesale or cash and carry trader can also undertake SBRT subject to these conditions, with separate books for the two arms; see wholesale trading and e-commerce. Retail of more than one brand falls under multi brand retail trading, with a lower cap and the Government route.
A worked example
Lindqvist Home AB owns the "Lindqvist" furniture brand, sold under that name in several countries. It forms Lindqvist Retail India Private Limited and holds all its shares. The products are of a single brand, sold under the same brand internationally and branded during manufacturing. The cap is hundred per cent and the route is automatic.
Because foreign investment is beyond 51 per cent, condition (e) applies. Lindqvist India starts online retail on 10 July of a year and opens its first store the next year. Its business commenced on the earlier event, the start of online retail, so the five-year averaging period begins on 1st April of that year, and the store had to open within two years of the online start, which it did.
In the first five years the group also buys Indian-made furniture for its stores abroad. Under condition (f) that sourcing for global operations may be set off against the 30 per cent requirement, and goods procured in India count whether sold in India or exported.
Need help opening single brand stores in India?
The sourcing clock, the brand agreement and the online-before-stores condition all start from the first sale. Our Indian subsidiary team sets up the retail company and builds the sourcing record that the statutory auditors will check.
Key takeaways
- Cap: hundred per cent. Route: "Automatic", by S.O. 4355(E) dated 5 December 2019.
- Products must be single brand, sold under the same brand internationally and branded during manufacturing.
- Beyond 51 per cent foreign investment, 30 per cent of the value of goods procured must be sourced from India.
- The norm is a five-year average first, then annual; global sourcing from India may be set off.
- Online retail may precede stores if stores open within two years.
- State-of-art and cutting-edge technology products may get a three-year relaxation on the Committee's recommendation.
Read next
- Serial numbers 15.1 and 15.2 of the Table: wholesale trading and e-commerce
- Serial numbers 15.4 and 15.5 of the Table: multi brand retail and shops in customs bonded areas
- Schedule I paragraph 3(a): automatic route and Government route
- How to set up a foreign subsidiary in India
Disclaimer: Based on the Gazette text of the instrument this article names, as notified and as amended by the notifications named in the article (for the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 the latest amendment consulted is S.O. 4870(E) dated 2 September 2026), as consulted on 2 October 2026. There is no official consolidated text; the provisions were read with each amendment applied. Sectoral caps, entry routes, conditions, forms and time limits change by notification, press note and circular; later changes should be checked on the Gazette, DPIIT and Reserve Bank sites. This article is general information, not legal advice; check the official text before acting.