FDI up 40% to $29.44 bn in Apr-Dec FY16

Foreign investment inflows were at $21.04 bn in the same period of previous fiscal

Foreign direct investment (FDI) into the country increased by 40% to $29.44 billion during April-December in the current fiscal.

The foreign investment inflows were at $21.04 billion in the same period of previous fiscal.

Among the sectors, computer hardware and software segment attracted the highest FDI of $5.30 billion during the period under review, followed by services sector ($4.25 billion) and trading business ($2.71 billion).

Automobile industry attracted FDI of $1.78 billion, while chemicals sector cornered $1.19 billion foreign equity investment in April-December 2015, the DIPP data showed.

Also, Singapore toppled Mauritius as the top FDI source for India during the period.

India received $10.98 billion overseas inflows from Singapore, followed by Mauritius ($6.10 billion), the US ($3.51 billion), the Netherlands ($2.14 billion), and Japan ($1.08 billion).

In the calendar year 2015, FDI in India grew by 37% to $39.32 billion as against $28.78 billion in the previous year, according to the data of Department of Industrial Policy and Promotion (DIPP).

The government has taken several steps to promote investments through a liberal FDI policy.

The Economic Survey 2015-16 has said that a favourable policy regime and sound business environment have facilitated increase in FDI flows into the country.

It has also raised questions over large FDI inflows from smaller countries including Singapore and Mauritius and wanted the government to find out whether the investments are being routed from these countries only to take advantage of tax avoidance agreements (DTAA).

"These inflows need perhaps to be examined more closely to determine whether they constitute actual investment or are diversions from other sources to avail of tax benefits under the Double Tax Avoidance Agreement (DTAA) that these countries have with India," it has said.