India's Foreign Direct Investment Surges, Despite Global Challenges

Foreign direct investment (FDI) in India decreased by 24.5% in the January-March quarter of 2024-25 but rose 13% to USD 50 billion over the prior fiscal year. Mauritius and Singapore were top investors. FDI in services and non-conventional energy increased, while computer software, hardware, and pharmaceuticals lagged.

Foreign direct investment (FDI) in India saw a decline of 24.5% to USD 9.34 billion during the January-March quarter of 2024-25, compared with the same period in the previous year. Despite this quarterly decrease, overall FDI rose 13% to USD 50 billion during the entire previous financial year, government data revealed on Tuesday.

The October-December 2024-25 quarter also reported a 5.6% contraction in FDI inflows due to global economic uncertainties. Nonetheless, total FDI, including equity, reinvested earnings, and other capital, increased by 14% to USD 81.04 billion, the highest in three years, up from USD 71.3 billion in 2023-24.

Singapore emerged as the largest FDI source with USD 14.94 billion, followed by Mauritius and the US. Sector-wise growth was observed in services, trading, telecommunications, among others, although inflows into computer software, hardware, and pharmaceuticals declined. Maharashtra led all Indian states with the highest FDI, capturing 39% of equity inflows.