FDI is allowed in India under two modes: the automatic route or through the government route. Companies don't need government approval in Automatic Route. companies need Government approval in Government mode. Provisions of the New FDI policy: An entity of a country , which shares a land border with India or where the beneficial owner of investment into India is situated in or is a citizen of any such country, can invest only under the Government route. Hence, Statement 1 is incorrect. A transfer of ownership in an FDI deal that benefits any country that shares a border with India will also need government approval. Investors from countries not covered by the new policy only have to inform the RBI after a transaction rather than asking for prior permission from the relevant government department. India shares land borders with Pakistan, Afghanistan, China, Nepal, Bhutan, Bangladesh, and Myanmar . This revised FDI policy aims to curb opportunistic takeovers/acquisitions of Indian companies due to the current Covid-19 pandemic. Hence, Statement 2 is incorrect. China's investment in the Indian business space has been expanding rapidly .