Mauritius, Netherlands and Switzerland makes the top 5 investment generating hubs
Despite the ongoing pandemic and global developments, India received the highest annual FDI inflows of US$84.835 billion in FY 21-22 overtaking last year’s FDI by US$2.87 billion.
Earlier, FDI inflows increased from US$74.391 billion in FY 19-20 to US$81.973 billion in FY 20-21.
India is rapidly emerging as a preferred country for foreign investments in the manufacturing sector.
FDI Equity inflow in Manufacturing Sectors have increased by 76% in FY 2021-22 (US$21.34 billion) compared to previous FY 2020-21 (US$12.09 billion).
Top 5 sectors receiving highest FDI Equity Inflow during FY 2021-22 are Computer Software & Hardware (24.60%), Services Sector (Fin., Banking, Insurance, Non-Fin/Business, Outsourcing, R&D, Courier, Tech. Testing and Analysis, Other) (12.13%), Automobile Industry (11.89%), Trading 7.72% and Construction (Infrastructure) Activities (5.52%).
Top 5 States receiving highest FDI Equity Inflow during FY 2021-22 are Karnataka (37.55%), Maharashtra (26.26%), Delhi (13.93%), Tamil Nadu (5.10%) and Haryana (4.76%)
FDI came from 101 countries in 2021-22, up from 97 countries in FY 2020-21.
The UNCTAD World Investment Report (WIR) 2022, in its analysis of the global trends in FDI inflows, says India has improved one position to 7th rank among the top 20 host economies for 2021.
The Government has implemented several transformative reforms under the FDI policy regime across sectors such as insurance, defence, telecom, financial services, pharmaceuticals, retail trading, e-commerce, construction and development, civil aviation as well as manufacturing.
The Government continues to liberalize investment restrictions, eliminate regulatory barriers, nurture international relations and improve business environment.
Changes are made in the FDI policy after having consultations with stakeholders including apex industry chambers, associations, representatives of industries and other organizations.
While foreign investments are permitted under the automatic route in most sectors and activities, due to strategic reasons certain investments are either restricted or permitted under the Government approval route through a screening mechanism as per the prescribed framework.
In India FDI up to 100% is allowed in non-critical sectors through the automatic route, not requiring security clearance from the Ministry of Home Affairs (MHA).
Prior Government approval or security clearance from MHA is required for investments in sensitive sectors such as defence, media, telecommunication, satellites, private security agencies, civil aviation and mining, besides any investment from Pakistan and Bangladesh.
All foreign investments are required to be in compliance with the applicable entry route, sectoral cap, attendant conditions, sectoral laws, Companies Act, 2013, and rules thereunder, pricing guidelines, documentation and reporting requirements, said the Ministry.
The FDI policy regime continues to welcome all investments in the country subject to compliance of applicable entry conditions and rules/regulations. fiinews.com
