NEW DELHI, Jan 5: Foreign Direct Investment (FDI) inflows to India are experiencing a significant increase, as investors from the Middle East, Japan, the European Union, and the United States recognize India’s position as a leading investment hub. This trend is propelling economic growth and creating millions of jobs, according to Commerce and Industry Minister Piyush Goyal.
Goyal highlighted that global investors are increasingly interested in India due to its numerous advantages, including a robust domestic market, a skilled workforce, and adherence to the rule of law.
“I can confidently state that FDI in India is on a rapid rise again, contributing to millions of job opportunities. Countries from the Middle East, the EFTA region, Japan, and investors from both the EU and the US are coming to realize that India remains the preferred destination for FDI,” he told PTI.
He emphasized that India’s stable and predictable regulatory environment, along with favorable business conditions and policies aimed at enhancing ease of doing business, are drawing an ever-increasing number of global investors.
“Last month, I met a CEO from one of the largest funds in the US, who is also the biggest investor in India. He mentioned that his investments here over the past decade have proven to be some of the most successful his funds have ever made,” he remarked.
The US fund, according to Goyal, revealed that they have been investing in India for the last 20 years, with over 80 percent of their total investments occurring in recent years.
“The CEO informed me that he plans to visit India to celebrate 20 years of investing in the country by announcing an additional investment tranche,” he stated.
The minister also noted that the strong performance of the Indian stock market is likely to continue attracting Foreign Institutional Investors (FIIs).
Since January, India has averaged over USD 4.5 billion in monthly FDI inflows, notwithstanding global uncertainties and challenges.
From January to September of this year, FDI to India rose approximately 42 percent to USD 42.13 billion, compared to USD 29.73 billion during the same period last year.
In the April-September period of 2024-25, FDI surged by 45 percent to USD 29.79 billion, up from USD 20.48 billion in the corresponding period of the previous fiscal year. The total FDI for 2023-24 amounted to a healthy USD 71.28 billion.
The sectors that are drawing the most significant inflows include services, computer software and hardware, telecommunications, trading, construction development, automobiles, chemicals, and pharmaceuticals.
Most sectors permit FDI through an automatic route, though areas like telecommunications, media, pharmaceuticals, and insurance require government approval for foreign investments.
These inflows are crucial as India will need substantial investments in the upcoming years to enhance its infrastructure and spur growth. Healthy foreign investments also support the balance of payments and stabilize the value of the rupee. (PTI)
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