India's FDI Landscape: Growth Amid Global Challenges

India's foreign direct investment (FDI) fell by 24.5% in early 2024-25 but grew 13% in the previous financial year. Singapore, Mauritius, and the US were top contributors. Maharashtra led Indian states in FDI inflow. The government emphasized reforms to maintain India as an attractive investment hub.

Foreign direct investment in India dropped significantly by 24.5% in the first quarter of 2024-25, recording USD 9.34 billion, as per government data released this week. Conversely, the previous financial year witnessed a 13% rise in total FDI, achieving USD 50 billion.

Singapore emerged as the foremost contributor with USD 14.94 billion, followed by Mauritius and the United States. Sectors like services, trading, and telecommunications saw increased investments, whereas computer software, construction, and pharmaceuticals experienced declines. Maharashtra topped state-wise FDI inflows with USD 19.6 billion.

The Indian government maintains a liberal FDI policy, allowing 100% foreign investment in most sectors automatically. Officials reiterated their commitment to ongoing policy reforms to enhance India’s status as a competitive investment destination. Manufacturing FDI also rose by 18% in 2024-25.