INDIA AMONG TOP 10 FDI DESTINATIONS IN THE WORLD
1INTRODUCTION
  • In the backdrop of the COVID-19 crisis, while global investments depict a decline in Foreign Direct Investment (FDI) inflows, Indian prospects are bright owing to its sustained long-term growth trend. 1 
  • According to the United Nations Conference on Trade and Development (UNCTAD), India’s large market and positive economic growth in the post-pandemic period will draw investments to the country. 2
 
Source: 1
2INDIA: RANK AND STATUS
  • India was the 9th largest recipient of FDI in 2019 according to World Investment Report 2020 by UNCTAD. India is also the biggest FDI host in South Asia and contributed largely to the overall FDI growth of 10% recorded in the region. 1 
  • The report also stated that professional services and digital economy, which are among the most sought-after industries in India, may show a speedy rebound owing to the interest shown by venture capital firms and technology companies in India’s market through acquisitions. 1
 
Source: 1
3GROWTH AND INVESTMENTS IN INDIA
  • The total FDI (Equity inflows, Re-invested earnings and Other capital) into India increased from USD 62 Bn in FY 2018-19 to USD 73.45 Bn in FY 2019-2020 showing a growth of 18%. 1
  • Major deals and investments in India in 2019 include USD 7 Bn acquisition in the Steel sector and USD 2.7 Bn investments in internet companies. Moreover, deals concluded in the first quarter of 2020 include USD 650 Mn deals, mostly in the Digital sector and USD 800 Mn acquisition in the Energy sector. 2

 

Source: 1, 2

4SECTORAL PERFORMANCE
  • As of March 2020, the following sectors have attracted the highest cumulative FDI inflows since April 2000: 1
    1. Services Sector: Financial, Banking, Insurance, Non-Financial / Business, Outsourcing, R&D, Courier, Technology Testing and Analysis (USD 82 Bn)
    2. Computer Software and Hardware (USD 44.9 Bn)
    3. Telecommunications (USD 37.2 Bn)
    4. Trading (USD 27.5 Bn)
    5. Construction Development: Townships, Housing, Built-Up Infrastructure and Construction Development Projects (USD 25.6 Bn)
  • Service Sector Industry, which is the single largest contributor to India’s GDP 2, is also the top performer in terms of percentage of Equity Inflows. 3

 

Source: 1, 2, 3