What happened?
India recorded a Foreign Direct Investment (FDI) inflow of $81.04 billion (provisional) in Fiscal Year 2024–25, marking a 14% increase from $71.28 billion in FY 2023–24. This growth is attributed to the government’s investor-friendly FDI policy, which keeps most sectors open for 100% FDI through the automatic route. The services sector was the top recipient, attracting 19% of total inflows, followed by computer software and hardware (16%) and trading (8%). Manufacturing FDI also grew by 18% in FY 2024–25, reaching $19.04 billion. Maharashtra accounted for the highest share (39%) of total FDI equity inflows, with Singapore leading as the top source country (30%). Over the last eleven financial years (2014–25), India attracted FDI worth $748.78 billion, a 143% increase over the previous eleven years (2003–14).
Why it matters to India
The substantial increase in FDI inflows reaffirms India’s position as a preferred global investment hub. This reflects growing international confidence in India’s economic resilience and the effectiveness of its proactive policy framework. The diversification of FDI across sectors and the increase in source countries from 89 to 112 highlight India’s growing global appeal as an investment destination, contributing to job creation and economic growth.