Categories: Economy

India may draw $475 billion in FDI in next 5 years: Report

India may draw $475 billion in FDI: India has promising growth prospects for foreign direct investment (FDI) and has the potential to draw $475 billion in FDI flows over the next five years, according to a CII-EY report. Despite the effects of the pandemic and geopolitical developments, foreign direct investment (FDI) in India has steadily increased over the past ten years, reaching $84.8 billion in FY 2021–22.

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India may draw $475 billion in FDI: Key Points

71% of multinational corporations (MNCs) with operations in India view it as a key market for their international expansion. Prospects for the long run and the short term are what are fueling the optimism.
According to the report titled “Vision – Developed India: Opportunities and Expectations of MNCs,” the majority of MNCs believe that the Indian economy will perform significantly better in the next three to five years.
With 96% of respondents being optimistic about the overall potential of the country.
The robust momentum in India’s domestic consumption, services, digital economy, and infrastructure is dictating the country’s growth trajectory.
Behind only the US and China, the forecasted actual growth in consumption is the third greatest, and by 2025, the rapidly growing digital economy is predicted to reach $1 trillion.

India’s Economic Growth: Important Factors

India’s potential is fueled by a number of factors, including the country’s ranking as one of the largest and fastest-growing economies in the world, strong consumer patterns, digitization, and an expanding services industry.
India is one of the world’s largest economies with one of the fastest rates of growth.
The government’s strong emphasis on infrastructure and manufacturing, along with strong consumption trends, digitisation, and a growing services sector, have all contributed to the confidence in India’s potential.
Significantly, more than 60% of MNCs reported that the business environment has improved during the previous three years.
MNCs value the effects of the GST, the government’s push toward digitalization in many areas, and tax transparency, among other reforms.
India is a big and stable democracy which is another factor that makes India a desirable investment destination for MNCs.
India is likewise viewed as an option by the majority of respondents to their China+1 approach.