Gross FDI in India rises 25.7% in H1FY25; net FDI moderates to $3.6 bn

With rising global investments in artificial intelligence start-ups, India is well-positioned to leverage its rapidly growing AI ecosystem to attract further investments and stimulate innovation

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Gross Foreign Direct Investment (FDI) in India during April–September 2024 (H1FY25) grew by 25.7 per cent year-on-year (Y-o-Y) to $42.1 billion, up from $33.5 billion in the same period last year, according to data from the Reserve Bank of India (RBI).

 

However, net FDI—calculated as inflows minus outflows—moderated to $3.6 billion during H1FY25, compared to $3.9 billion in the same period last year. The decline was attributed to an increase in repatriation and outward FDI, as detailed in the RBI’s November 2024 bulletin.

 

Repatriation or disinvestment by investors who had made direct investments in India rose to $27.8 billion in the first six months of FY25, up from $23.1 billion during April–August 2023. Outward FDI during April–September 2024 stood at $10.7 billion, compared to $6.5 billion in the same period of FY24.

 

The “State of Economy” report in the RBI bulletin observed that manufacturing, financial services, electricity and other energy sectors, and communication services collectively accounted for about two-thirds of gross FDI inflows. Singapore, Mauritius, the Netherlands, the UAE, and the US were the sources for approximately three-fourths of the inflows.

 

India’s AI ecosystem attracting global investments

 

With rising global investments in artificial intelligence (AI) start-ups, India is well-positioned to leverage its rapidly growing AI ecosystem to attract further investments and stimulate innovation. Since 2023, India has ranked among the top six economies globally in terms of investments in generative AI start-ups. Additionally, the country is listed among the top ten nations in cumulative private AI investments between 2013 and 2023, the report added.