Foreign direct investment News

FM Sitharaman also said that India offers a compelling growth opportunity for foreign banks, and the government is actively encouraging foreign investment in the banking sector.

Notably, $300 billion of this came between 2019 and 2024 alone, underscoring an accelerated growth trajectory, he mentioned in a media article.

India has achieved a remarkable milestone in its economic journey, with gross foreign direct investment (FDI) inflows reaching an impressive USD 1 trillion since April 2000.

The main sectors of the economy that benefited from the FDI include services, automobile, computer software, IT hardware, telecom and pharmaceuticals and chemicals.

This investment has come across India and 57 sectors of the country and played an important role in the development of various industries.

Maharashtra continues to dominate the foreign investment landscape, securing over half of the nation's total investments in the first quarter.

The FDI policy reform will enhance Ease of Doing Business in the country, leading to greater FDI inflows and thereby contributing to growth of investment, income and employment, said the Cabinet note.

Indian corporate entities can make overseas investments. The earlier regime didn't permit Overseas Direct Investment by a non-financial sector. Govt. issued two gazette notifications in which ODI & OPI have been demarcated.

FDI is a type of investment wherein an investor from one country establishes or significantly influences a business entity in another economy. The increase in FDI inflows is a result of the measures taken by the Government on FDI policy reforms.

India remained among the top 10 global economies for FDI last year. FDI inflow recovered to pre-pandemic levels last year, said UN report. India had received USD 64 billion in FDI in 2020.

In the sector, 100 per cent FDI is permitted under the automatic route. The sector has witnessed FDI equity inflow of USD 4.99 billion during the period April 2014 to September 2021.

The domestic companies had invested USD 2.23 billion in their overseas joint ventures and fully-owned subsidiaries during December 2020 in the previous financial year. Of the total investment made by the Indian companies overseas during the month, USD 1.22 billion was in the form of issuance of guarantees. Reliance New Energy Solar Ltd invested a total of USD 168.60 million in a JV and wholly-owned subsidiary in Germany and Norway.

Most of the foreign investment proposals have come from China and Hong Kong. Besides, Nepal, Bhutan and Bangladesh too have submitted certain applications. Countries that share land borders with India are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan.

FDI rose 10 percent. Highest ever of USD 81.72 billion during 2020-21. It was USD 74.39 billion in 2019-20.

Defence and Aerospace sectors received FDI worth Rs 4191 cr FDI approvals have been given to 44 companies for joint ventures Government has permitted up to 74 per cent FDI in defence production

Government said that the changes in FDI policy will result in making India a more attractive FDI destination, leading to benefits of increased investments, employment and growth.

The decision to allow 100% FDI in coal mining and contract manufacturing, 26% FDI in digital marketing and relax sourcing norms for single-brand retailers was taken during a meeting of Union Cabinet chaired by Prime Minister Narendra Modi.

The body also said that there is a need to improve investor confidence about the surrounding ecosystem in the country to attract more FDI inflows.

According to the latest data of the Department for Promotion of Industry and Internal Trade (DPIIT), FDI in 2017-18 was a record USD 44.85 billion.

The foreign fund inflows during April-September 2017-18 stood at USD 25.35 billion.