The BSE index is up 0.38 percent and the NSE index gains 0.32 percent.
India relaxed foreign direct investment (FDI) rules on Tuesday in a broad swathe of industries including telecoms, single-brand retail and oil and gas in a bid to lure capital inflows, prop up a sliding currency and rev up growth.
Shares in mobile operators such as Reliance Communications Ltd gain a day after India approved raising the foreign investment limit in the sector to 100 percent from 74 percent.
Lenders such as Yes Bank and other financial firms fall for a second day after the central bank raised short-term interest rates in a bid to curb the rupee's slide.
Financial companies dependent on short-term wholesale funding will be most affected by the central bank's measures to curb liquidity, analysts say.