India Simplifies Nearly 48,000 Business Compliances as DPIIT Advances Trust-Based Governance

India has undertaken extensive regulatory reforms to improve the ease of doing business, strengthen entrepreneurship and encourage domestic and foreign investment. The Department for Promotion of Industry and Internal Trade (DPIIT), under the Ministry of Commerce and Industry, has reported the reduction of 47,957 compliance requirements across Central Ministries, States and Union Territories as part of the government’s transition towards trust-based governance.

According to an official announcement issued on 27 October 2026, the reforms encompass the digitisation and simplification of regulatory procedures, decriminalisation of minor offences, expansion of startup financing, liberalisation of foreign investment regulations and integration of business approvals through digital platforms. These initiatives are intended to reduce administrative burdens, improve regulatory transparency and create a more favourable environment for industrial development and entrepreneurship.

The government has also highlighted substantial growth in India’s startup ecosystem, with more than 2.5 lakh DPIIT-recognised startups reporting over 25 lakh employment opportunities. Meanwhile, the National Single Window System has delivered more than 8.5 lakh regulatory approvals, reflecting the growing adoption of digital governance in business administration.

Nearly 48,000 Compliance Requirements Reduced Across India

One of the most significant achievements of the regulatory reform programme is the reduction of 47,957 compliance requirements across Central Government departments, State Governments and Union Territories. The initiative focuses on eliminating unnecessary procedures, simplifying existing obligations and replacing manual administrative processes with digital systems.

Of the total compliance requirements addressed, 22,290 have been digitised, allowing businesses to complete regulatory procedures electronically. Another 16,141 requirements have been simplified to reduce procedural complexity, while 5,255 have been decriminalised. An additional 4,271 requirements have been eliminated entirely.

The reforms are designed to reduce the administrative time and resources businesses spend fulfilling routine regulatory obligations. By improving the accessibility of government services and reducing repetitive documentation, the government aims to enable enterprises to concentrate more effectively on manufacturing, innovation, investment and commercial expansion.

Digital compliance systems are also expected to improve transparency by reducing dependence on physical paperwork and direct interactions with multiple administrative authorities. These changes are particularly relevant for smaller enterprises that often lack dedicated teams to manage complex regulatory procedures.

Jan Vishwas Reforms Decriminalise 900 Legal Provisions

The government’s trust-based governance initiative has been supported by legislative reforms intended to reduce the criminalisation of minor and procedural regulatory violations. Under the Jan Vishwas legislative framework, 900 provisions of Central laws have been decriminalised through reforms introduced in 2023 and 2026.

The Jan Vishwas reforms undertaken in 2023 covered 183 provisions across 42 Central Acts. The subsequent legislative reforms in 2026 addressed another 717 provisions across 79 Acts, significantly expanding the scope of the initiative.

These changes seek to distinguish serious offences from procedural violations that can be addressed through proportionate civil or administrative penalties. The objective is to promote compliance without exposing businesses and individuals to criminal proceedings for specified minor violations.

The reforms are expected to provide greater regulatory certainty to enterprises while reducing unnecessary litigation and improving the relationship between government authorities and regulated businesses. However, the decriminalisation measures do not remove the underlying legal obligations or eliminate penalties for serious violations.

Startup India Recognises More Than 2.5 Lakh Enterprises

India’s startup ecosystem has expanded considerably under the Startup India initiative, which was introduced to encourage innovation, entrepreneurship and employment generation. DPIIT has recognised 2,50,046 startups operating across more than 770 districts, demonstrating the growing geographical reach of entrepreneurial activity.

These recognised enterprises have reported generating more than 25.42 lakh jobs, highlighting the contribution of startups to employment creation and economic diversification. The expansion has been particularly notable outside the country’s traditional metropolitan business centres.

Approximately 52 per cent of DPIIT-recognised startups are located in non-metro cities, indicating that entrepreneurship is increasingly emerging from smaller cities and developing economic regions. This geographical diversification is important for encouraging local innovation, expanding employment opportunities and supporting economic activity beyond established industrial and technology hubs.

Women’s participation has also emerged as a significant feature of India’s startup ecosystem. According to DPIIT, approximately 48 per cent of recognised startups have at least one woman director, reflecting the growing involvement of women in entrepreneurial leadership and business management.

The number of startups receiving official recognition has continued to increase, rising from 34,200 during 2023–24 to 36,440 in 2024–25. The expansion reflects the increasing participation of entrepreneurs across industries, including technology, manufacturing, healthcare, agriculture, education and services.

Government Expands Financial Support for Startups

Access to institutional financing remains a central component of the government’s strategy to strengthen the startup ecosystem. Several financial assistance programmes have been introduced or expanded to support enterprises at different stages of development.

Under the Startup India Seed Fund Scheme, financial assistance amounting to ₹775.67 crore has been approved for 4,194 startups through 244 incubators operating across 32 States and Union Territories. The programme supports eligible early-stage enterprises seeking resources for product development, prototype creation, market entry and commercialisation.

The beneficiaries include 2,147 women-led startups and 2,356 startups from Tier-II and Tier-III cities, reflecting the programme’s efforts to extend financial assistance beyond established startup centres.

The Fund of Funds for Startups has also played an important role in mobilising investment capital. Through the Small Industries Development Bank of India, commitments amounting to ₹12,623 crore have been made to 166 Alternative Investment Funds. These funds have subsequently invested approximately ₹28,254 crore in 1,475 startups.

The Credit Guarantee Scheme for Startups has provided guarantees for 532 loans amounting to ₹1,662.71 crore. The supported enterprises have reported employing approximately 41,637 people.

To improve access to credit, the maximum guarantee cover available per borrower has been increased from ₹10 crore to ₹20 crore. The government has also reduced the annual guarantee fee to one per cent for 27 identified Champion Sectors, making the scheme more accessible to eligible enterprises operating in priority industries.

These financing initiatives are intended to address the difficulties faced by emerging businesses in securing institutional credit, particularly when they lack substantial collateral or an established operating history.

Government Procurement Creates New Opportunities for Emerging Businesses

DPIIT has also highlighted measures designed to improve startup participation in government procurement. Public procurement represents a potentially important market for emerging enterprises, but traditional eligibility requirements can limit the participation of newly established businesses.

To address these challenges, the government has relaxed certain conditions relating to prior experience, minimum turnover and Earnest Money Deposits for eligible startups participating in public procurement.

The number of startups registered on the Government e-Marketplace has increased from 7,929 in January 2021 to 43,260. These businesses have supplied approximately 6.23 lakh orders valued at ₹68,105 crore to government buyers.

The expansion of startup participation in public procurement provides opportunities for smaller enterprises to establish commercial relationships, increase production and demonstrate the capabilities of innovative products and services.

Institutional support for entrepreneurship has also expanded at the State level. The number of States and Union Territories with dedicated startup policies has increased from four in 2016 to 32. Additionally, 104 new incubators have been established across 17 States and Union Territories, strengthening the infrastructure available to entrepreneurs.

National Single Window System Delivers More Than 8.5 Lakh Approvals

The National Single Window System has emerged as an important component of India’s efforts to simplify regulatory approvals and improve the experience of businesses seeking to establish or expand operations.

According to DPIIT, the platform has received 15,49,850 applications, registered 5,76,778 businesses and delivered more than 8.5 lakh approvals. These figures demonstrate the scale of adoption of the digital system by enterprises seeking regulatory permissions from government authorities.

The platform currently provides access to 3,779 services, including 327 Central Government services and 3,452 services offered by State Governments. It integrates 34 States and Union Territories with 32 Central Ministries and Departments, allowing businesses to access a wide range of approval-related services through a common interface.

The National Single Window System is designed to reduce the difficulties associated with obtaining permissions from multiple departments. Instead of navigating separate administrative procedures independently, entrepreneurs can identify relevant approvals and access participating government services through an integrated digital platform.

The system is particularly important for manufacturing and industrial enterprises, which often require multiple permissions relating to land use, environmental clearances, industrial operations, construction and other regulatory requirements.

By improving access to information and integrating approval processes, the platform aims to reduce procedural delays and provide greater predictability for investment projects.

Digital Approval Services Available in 22 Indian Languages

An important feature of the National Single Window System is its Know Your Approvals module, which helps businesses identify the regulatory permissions required for specific commercial activities.

The module provides information relating to more than 8,000 approvals administered by Central and State authorities. Of these, 2,825 approvals have been integrated through the module, comprising 592 Central and 2,233 State approvals.

The system also incorporates mechanisms to reduce repetitive data entry. According to DPIIT, 89 common information fields are automatically populated across 285 approval processes, reducing the need for businesses to submit the same information repeatedly.

The availability of the platform in 22 Indian languages is another important development, allowing entrepreneurs from different linguistic backgrounds to access information about regulatory requirements.

DPIIT has additionally introduced automated procedures for selected services by integrating information from government databases. Industrial Entrepreneur Memorandums can now be generated using information available through systems maintained by the Ministry of Corporate Affairs, the Goods and Services Tax Network and other departments.

These measures demonstrate the potential of digital integration to eliminate redundant administrative processes and simplify interactions between businesses and government agencies.

Labour and Industrial Licensing Reforms Simplify Business Operations

The business reform programme also includes changes to labour regulations and industrial licensing procedures aimed at reducing administrative complexity.

The government has consolidated 29 Central labour laws into four Labour Codes, creating a more unified legislative framework covering wages, industrial relations, social security and occupational safety.

The threshold for prior government permission in specified cases involving retrenchment, lay-offs and establishment closures has been increased from 100 to 300 workers. Other changes include revised factory applicability thresholds and an increase in the threshold for contract labour licensing from 20 to 50 workers.

DPIIT has also highlighted provisions requiring a 30-day compliance notice before the initiation of legal proceedings in applicable circumstances. Such measures are intended to provide regulated enterprises with opportunities to address specified compliance deficiencies before facing enforcement action.

Industrial licensing reforms have accompanied these changes. The validity of licences issued by the Petroleum and Explosives Safety Organisation has been extended from five years to ten years, reducing the frequency of renewal requirements for affected businesses.

The organisation’s licensing services have also been digitised and integrated with the National Single Window System, enabling businesses to access relevant procedures electronically.

These reforms seek to improve administrative efficiency while maintaining the regulatory safeguards applicable to industrial activities, workplace conditions and public safety.

India Attracts $843 Billion in Foreign Direct Investment Over Twelve Years

India’s foreign direct investment framework has undergone considerable liberalisation as part of the government’s efforts to attract international capital, support manufacturing and facilitate technology partnerships.

According to DPIIT, India received approximately ₹80.12 lakh crore, equivalent to US$843 billion, in cumulative foreign direct investment between the financial years 2014–15 and 2025–26.

This represented an increase of 169 per cent compared with approximately ₹29.75 lakh crore, equivalent to US$313 billion, received during the preceding twelve-year period.

Annual foreign direct investment inflows reached approximately ₹8.35 lakh crore, or US$94.53 billion, during 2025–26, which the government identified as a record level.

The government has expanded the automatic route for foreign investment in several sectors, allowing eligible overseas investors to participate without requiring prior government approval.

In the defence sector, the automatic-route investment limit for new industrial licences has been increased from 49 per cent to 74 per cent. The insurance sector has also undergone liberalisation, with foreign investment permitted up to 100 per cent under specified conditions.

Other sectors permitting up to 100 per cent foreign direct investment through the automatic route include telecommunications and selected activities involving civil aviation, satellite components and broadcasting distribution.

The government considers these reforms important for encouraging international investment, supporting domestic manufacturing, strengthening technological capabilities and integrating Indian enterprises more closely with global production networks.

State and District-Level Reforms Strengthen Business Governance

The regulatory reform programme extends beyond Central Government departments and includes initiatives implemented by State Governments, Union Territories and local administrative authorities.

Under seven editions of the Business Reforms Action Plan, States and Union Territories have implemented more than 9,700 reforms aimed at simplifying administrative procedures and improving the regulatory environment.

The programme encourages States to adopt digital approval systems, improve transparency, simplify licensing procedures and reduce unnecessary documentation requirements.

At the district level, the District Business Reforms Action Plan extends 222 reforms to district collectorates, development authorities and urban local bodies.

These local-level reforms are particularly significant because businesses frequently interact with district and municipal authorities when obtaining land-related permissions, construction approvals, commercial licences and other operational clearances.

Improving regulatory processes at these administrative levels can help reduce delays experienced by enterprises and encourage investment in smaller cities and emerging industrial regions.

The participation of State and local authorities also reflects the importance of coordinated governance in implementing nationwide business reforms.

Building a More Competitive and Investment-Friendly Economy

The regulatory reforms outlined by DPIIT reflect India’s continuing efforts to create a business environment characterised by simpler procedures, digital accessibility and proportionate enforcement.

The reduction of 47,957 compliance requirements, decriminalisation of 900 legal provisions and expansion of the National Single Window System represent substantial changes to the regulatory framework governing business activity.

At the same time, the growth of the Startup India ecosystem, expanded access to institutional financing and increased participation in government procurement demonstrate the government’s emphasis on encouraging entrepreneurship and innovation.

Foreign investment liberalisation and improvements in industrial approval procedures are intended to complement these initiatives by attracting capital, encouraging manufacturing and strengthening India’s competitiveness in international markets.

The long-term effectiveness of the reforms will depend on consistent implementation across government departments, reliable digital infrastructure, effective coordination between Central and State authorities and measurable reductions in the actual compliance burden experienced by businesses.

By combining regulatory simplification, institutional support for entrepreneurship and technology-driven governance, India is seeking to establish a more efficient business environment capable of supporting industrial expansion, employment generation and sustained economic development.

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