India attracted $42.1 billion FDI in H1FY25, gross inflow since April 2000 reaches $1 trillion

FILE PHOTO: U.S. dollar banknotes are seen in this illustration taken March 10, 2023. REUTERS/Dado Ruvic/Illustration/File Photo

India managed to attract $42.1 billion in foreign direct investment during the first half of the fiscal, a Commerce Ministry statement said on December 12, adding that the cumulative FDI inflow into India since April 2000 has reached the $1 trillion mark.

The growth in FDI during H1FY25 has been 26% higher on year. The Ministry said this reflects India’s growing appeal as a investment destination. "FDI has played a transformative role in India’s development by providing substantial non-debt financial resources, fostering technology transfers, and creating employment opportunities," said the statement.

Initiatives like 'Make in India' and Goods and Services Tax (GST) have enhanced investor confidence, helping attract foreign investment. In the last decade alone, the total FDI into India has amounted to $709.84 billion, making up for more than two-third of the overall FDI inflow in the past 24 years, government data showed.

India's ranking in the World Competitive Index 2024 jumped three positions to 40th in three years, while the country was the 48th most innovative nation on the Global Innovation Index compared to 81st position in 2015. Last year, India was the third-largest recipient of financing for greenfield projects. India also registered significant progress in improving the business environment, rising from 142nd in 2014 to 63rd in the World Bank’s Ease of Business Report 2020.

In recent months, Taiwanese companies are shifting supply chains to India amid global trade tensions. Centre has also implemented relaxation in FDI rules in more sectors, including space, and is looking to allow more foreign direct investment in insurance.

Foreign investors are likely deploy as much as $100 billion in India this fiscal, in space such as high-tech manufacturing, infrastructure and green projects, according to a Citigroup banker.