India has recorded a historic milestone by securing USD 81.04 billion in Foreign Direct Investment (FDI) during the fiscal year 2024–25, registering a 14% growth over the previous year. This surge, driven by robust inflows into the services and manufacturing sectors, reflects the success of India’s liberalized investment regime and its rising prominence as a global business destination.
Why in News?
India’s FDI inflows in FY 2024–25 have reached an all-time high of USD 81.04 billion. The services sector led this growth with a 40.77% rise in FDI equity inflow, positioning India as a dynamic and attractive investment hub amid global economic uncertainties.
Key Highlights
- Total FDI Inflow (FY 2024–25): USD 81.04 billion, up 14% from FY 2023–24.
Top Sectors
- Services Sector: USD 9.35 billion (40.77% YoY growth)
- Computer Software & Hardware: 16% of total FDI
- Trading Sector: 8% of total FDI
- Manufacturing Sector: USD 19.04 billion (18% growth from previous year)
Top FDI-Receiving States
- Maharashtra: 39% of total FDI equity
- Karnataka: 13%
- Delhi: 12%
Top Source Countries
- Singapore: 30% share of total inflows
- Mauritius: 17%
- United States: 11%
Long-Term FDI Growth
- FDI from FY 2014–25: USD 748.78 billion
- FDI from FY 2003–14: USD 308.38 billion
- Total FDI over 25 years: USD 1,072.36 billion
Growing Global Confidence
- Source Countries: Increased from 89 (FY 2013–14) to 112 (FY 2024–25)
Policy Reforms Boosting FDI
2014–19 Reforms
- Raised FDI caps in Defence, Insurance, and Pension
- Liberalized Construction, Civil Aviation, and Retail sectors
2019–24 Reforms
- 100% FDI allowed under automatic route in Coal Mining, Contract Manufacturing, and Insurance Intermediaries
- 2025 Union Budget: Proposed raising FDI limit to 100% for companies investing entire premium within India
Significance
- India’s record FDI inflow reflects investor confidence, a liberalized economic policy environment, and the country’s emergence as a preferred destination for global capital.
- It bolsters economic growth, job creation, and technology transfer, contributing to India’s Viksit Bharat (Developed India) vision.
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