Singapore remained the leading FDI source, contributing for 29% of inflows in the previous fiscal, followed by the United States (23%), and Mauritius (9%).
Despite the pandemic’s onslaught, foreign direct investment (FDI) in equities in India increased 19% year on year to a record $59.6 billion last fiscal. However, such inflows, which had increased by as much as 40% from April to December, seemed to have slowed in the March quarter.
According to data issued by the commerce and industry ministry on Monday, gross FDI inflows, which comprise FDI in equity, reinvested profits, the equity capital of unincorporated organisations, and other capital, increased 10% year on year to an all-time high of $81.7 billion in FY21. Gross FDI had also increased by a solid 22% up to December previous fiscal year before slowing in the March quarter.
Despite a little slowdown in the March quarter, the inflows last fiscal year remained quite positive, given the pandemic’s destruction and disruption throughout the world. Inflows may have been hampered by a surge in cases in crucial states like Maharashtra in the second wave (in March) and certain mobility restrictions.
The intensity of the second wave, as well as local lockdowns implemented by some governments to limit the Covid-19 spike, will be the major risk for FDI inflows in the future, especially in the June quarter.
Surprisingly, inflows into the digital industry raised inflows significantly last fiscal year. Analysts have already pointed out that Reliance Jio alone drew a significant amount of FDI.
The FDI inflows come at a time when domestic private investment has been hard to come by in recent years. Private consumption has been severely harmed by income losses in the aftermath of the epidemic, therefore investments are vital to the country’s economic recovery.
Computer software and hardware was the most popular industry, accounting for 44% of total FDI equity inflows, followed by building (infrastructure) activities (13%), and the services sector (12%). (8 percent ).
Gujarat received the most FDI (78 percent) thanks to Reliance Jio, while Karnataka and Delhi received 9 percent and 5%, respectively.
ALSO READ : Maruti, Toyota, and M&M continue to be bullish on the used car market’s long-term rise
Hello, my name is Anuj Boruah. I am quite interested in writing about current events in business, finance, and the economy. I work as a newswriter at Reviewminute.