The Indian government has updated its Corporate Social Responsibility (CSR) framework to formally include foreign subsidiaries operating in India, marking a significant policy shift aimed at ensuring broader corporate contribution to social development goals. As per the latest amendment to the Companies (CSR Policy) Rules, 2014, all subsidiaries registered under the Companies Act, 2013, including those wholly or majority owned by foreign parent entities, will now be subject to mandatory CSR compliance if they meet the financial thresholds defined under Section 135 of the Act.

This means that Indian subsidiaries of global firms with a net worth of ₹500 crore or more, annual turnover of ₹1,000 crore or more, or net profit of ₹5 crore or more during any financial year are now required to spend at least 2% of their average net profits from the preceding three years on eligible CSR activities. These include initiatives in education, healthcare, environmental sustainability, rural development, and women’s empowerment, among others.

The revised rules also mandate that foreign subsidiaries maintain a formal CSR committee, file annual CSR reports, and disclose their project details in the Board’s report and on their official websites. Experts believe this inclusion will significantly increase corporate funding for grassroots development while reinforcing the principle that all profit-making enterprises benefiting from India’s market environment should also contribute to its social progress. The move enhances transparency, promotes local community engagement, and ensures accountability, placing Indian subsidiaries of foreign firms on par with domestic companies in fulfilling national development objectives.