India Business Law Journal – May 2025

Electrifying changes

Government’s PLI scheme seeks to bring the manufacturing sector to life

The fallout in the US-China trade relationship was closely watched in India, with anticipation of how the developments would benefit the country’s economy. However, India was also at the receiving end of US President Donald Trump’s ire, with Apple CEO Tim Cook being warned to pivot iPhone production from China back to the US rather than to India, where the company had stated its vision to produce 25% of its iPhones.

India has risen to become the world’s second-largest mobile phone manufacturer. This is in contrast to other areas of manufacturing, where the country has much catching up to do.

In this regard, the government in March 2025 cleared a USD2.7 billion electronic component manufacturing scheme. The production-linked incentive (PLI) scheme aims to support the development of a robust electronic component ecosystem. Going beyond India’s capability to manufacture phones, the scheme seeks to develop the country’s expertise in manufacturing consumer electronics, telecoms, automobiles, medical devices and defence equipment.

The cover feature of the issue, Manufacturing shock therapy, looks at the government’s rationale for putting emphasis on this area, the country’s existing manufacturing capabilities, and the challenges ahead.

The Briefing covers a major development for the legal profession, with the Bar Council of India (BCI) notifying the amended Bar Council of India Rules for Registration and Regulation of Foreign Lawyers and Foreign Law Firms in India, 2022, to allow entry of foreign lawyers and law firms into the country. The legal community’s outlook is positive, but challenges remain.

Lalit Bhasin, of the Society of Indian Law Firms, points out that the Advocates Act needs to be amended in parliament for the doors to be truly open to foreign lawyers. Another hurdle, as Sherina Petit from Stewarts Law in London points out, is posed by the BCI itself in the form of prohibitively expensive fees for foreign lawyers. As always with this issue, is it a case of one step forward, two steps back?

Uncertainties and challenges are par for the course for legal practitioners. In Risk: Ethical risk mapping for legal departments, GC Prarabdha Jaipuriar, the VP and general counsel at SUEZ India, writes that deploying an ethics and compliance programme can go some distance towards reducing risks. He advocates for the creation of a risk map that will identify challenges both within and outside the organisation.

Industry best practices are important throughout the chain of corporate functions to ensure robust operations. In a similar vein, Blue Star India’s group legal adviser, Badrinath Durvasula, writes about how in-house counsel can excel in their careers.

In Blueprint for in–house success, Durvasula shares insights from his 35 years of working at well-known conglomerates such as Larsen & Toubro and Adani Group. He says in-house counsel must look beyond legal issues and understand the company’s operations in areas such as production, marketing, suppliers, vendors and logistics, as well as be familiar with the business objectives set by the management.

This issue features the inaugural IBLJ Regional Law Firm Awards 2025 to honour the important work done by firms outside New Delhi and Mumbai. These firms may not be the talk of the town like their big-city counterparts, but they have proven to be a force to be reckoned with when regional expertise is required. The awards seek to recognise firms based in the cities of Ahmedabad, Bengaluru, Chennai, Hyderabad, Jaipur, Kolkata and Pune.

In an Expert briefing, authors from A&O Shearman explain how foreign investors can participate in India’s distressed debt markets through purchasing security receipts from asset reconstruction companies, given the low entry barriers for them. However, they also caution against capital constraints in the market, overlaps in regulatory jurisdiction, and the delayed monetisation of troubled assets.

Another Expert briefing from LexStart looks at the corporate phenomenon of overseas startups set up by Indian founders redomiciling in India. Earlier, it was common for such companies to set up a base overseas due to reasons such as easier access to capital and a more favourable tax and regulatory environment. However, with recent changes, such as more favourable policy conditions and stronger capital markets, these companies have decided to return home.

Finally, we turn to the Correspondents section, where Cyril Amarchand Mangaldas and Anand and Anand join us with their first columns. These powerhouse law firms will be writing on the topics of foreign direct investment and artificial intelligence, respectively. IBLJ’s Correspondents law firms bring not only their expertise on these topics, but also unique insights and perspectives that make their columns a compelling read.