Foreign Direct Investment (FDI) is a major driver of economic growth and an important source of non-debt finance for the economic development of India. It has been the endeavor of the Government to put in place an enabling and investor-friendly FDI policy. The intent all this while has been to make the FDI policy more investor-friendly and remove the policy bottlenecks that have been hindering the investment inflows into the country. The steps taken in this direction during the last six and a half years have borne fruit, as is evident from the ever-increasing volumes of FDI inflows being received into the country. Continuing on the path of FDI liberalization and simplification, the Government has carried out FDI reforms across various sectors.
Measures taken by the Government on the fronts of FDI policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into the country. The following trends in India’s Foreign Direct Investment are an endorsement of its status as a preferred investment destination amongst global investors:
- India has attracted total FDI inflow of US$ 67.54 billion during April to December 2020. It is the highest ever for the first ninth months of a financial year and 22% higher as compared to the first ninth months of 2019-20 (US$ 55.14 billion).
- FDI equity inflow grew by 40% in the first 9 months of F.Y. 2020-21 (US$ 51.47 billion) compared to the year ago period (US$ 36.77 billion).
- FDI inflow increased by 37% in 3rd Quarter of 2020-21 (US$ 26.16 billion) compared to 3rd quarter of 2019-20 (US$ 19.09 billion).
- FDI inflow showed positive growth of 24% in the month of December, 2020 (US$ 9.22 billion) compared to December, 2019 (US$ 7.46 billion)