India Fast-Tracks Approvals for Indo-Chinese JVs as Business Ties Warm Up

India is fast-tracking Press Note 3 (PN3) approvals for Indo-Chinese joint ventures as relations with Beijing improve. Dixon Technologies, Micromax, and Uno Minda await clearances for projects in electronics and automotive manufacturing. Faster approvals under PN3 and new incentives like ECMS and PLI are attracting significant investments, boosting India’s localization and manufacturing value chain.

India’s contract electronics manufacturing sector is witnessing renewed optimism as the government accelerates approvals under Press Note 3 (PN3), marking a subtle thaw in economic cooperation between New Delhi and Beijing. Dixon Technologies’ Managing Director, Atul Lall, shared that the firm expects PN3 clearance soon for two of its Indo-Chinese joint ventures (JVs)—one with Vivo for smartphone production and another with HKC Corp. for display manufacturing. Dixon’s JV proposal with Vivo was submitted six months ago, followed by HKC’s application in August, and both are reportedly “progressing well.”

This relatively quick response signals a shift from the earlier norm, where PN3 applications often languished for 12 to 24 months before approval or rejection. The improvement in bilateral relations between India and China appears to be expediting the process.

PN3 approval is mandatory for any foreign direct investment (FDI) originating from countries sharing a land border with India. It involves a multi-ministerial review, especially for sectors such as electronics and automotive manufacturing, where collaborations often involve sensitive technology transfers.

More Firms Join the Queue

The shifting stance isn’t limited to Dixon alone. Micromax’s manufacturing unit, Bhagwati Products, has also filed PN3 applications for two planned joint ventures under India’s component production-linked incentive (PLI) scheme, according to director Rajesh Agarwal. He noted that firms with a strong operational history and commitments to technology transfer stand a better chance of securing government approval.

Similarly, Uno Minda, a leading auto component manufacturer, has applied for PN3 clearance to transition its existing technical licensing agreement with China’s Inovance Automotive into a full-scale JV—70% owned by Uno Minda and 30% by the Chinese partner. The ₹423 crore project has already broken ground on a manufacturing facility in Pune, with insiders confident of imminent approval.

Before these approvals began moving faster, many component makers relied on technical licensing agreements (TLAs) to sidestep delays under PN3. However, industry executives point out that joint ventures provide a more stable and risk-balanced structure, allowing better control over technology, costs, and market exposure. With diplomatic and trade ties between the two nations gradually normalizing, more Indian firms are now exploring direct JV routes instead of temporary TLAs.

Policy Push and Investment Surge

Industry sources say the government is showing greater openness to PN3 proposals, particularly from large, reputable Indian firms engaged in the Electronics Component Manufacturing Scheme (ECMS) or the component PLI program. Many companies operating under these incentive frameworks have begun submitting fresh JV applications, expecting clearance within the next few months.

A senior executive from a publicly listed contract manufacturer said authorities are prioritizing PN3 approvals and could announce several of them by year-end (November–December) to align with broader industrial development goals.

Recent government data supports this momentum. In October, officials revealed that 249 ECMS project applications had been filed, representing a combined proposed investment of ₹1.15 lakh crore—nearly double the initial projection. The initiative aims to strengthen India’s domestic electronics manufacturing value chain and boost localization efforts.

In late October, the government cleared the first batch of seven projects worth over ₹5,500 crore, signaling a robust start to what could be a new phase of Indo-Chinese industrial collaboration—anchored in regulatory clarity and mutual commercial interest.