Equity FDI grows 15% to $18.6 billion in Q1, total inflows up 12%

Foreign direct equity investments saw 15 per cent growth year-on-year to $18.63 billion during the first quarter of the financial year 2025-26 (Q1FY26), data released by the Department for Promotion of Industry and Internal Trade (DPIIT) showed.

 

Total FDI, which includes equity capital of unincorporated bodies, reinvest earnings and other capital, saw 12 per cent growth to $25.18 billion during the period under review, according to the government data.

 

During the first three months of the current financial year, the FDI equity inflows increased from major countries, including Singapore, the United States (US), the United Kingdom (UK) and United Arab Emirates (UAE), Cyprus, Cayman Islands and Germany.

 

In fact, foreign investment inflow from the US saw 3.7-time growth during April-June to $5.6 billion, despite the global trade tensions and challenges pertaining to the imposition of tariffs by the US on countries, including India. The US emerged as India’s top investor in the quarter ended June. 

 

The US is also the third largest investor in India, with cumulative investments amounting to $76.26 billion between April 2000 and June 2025, ahead of Singapore and Mauritius.

 

Investments, however, fell from Mauritius, Netherland and Japan to $2.08 billion, $667 million and $551 million, respectively, during April-June, against $3.21 billion, $2.45 billion and $629 million in the year-ago period.

 

As far as sectors are concerned, inflows saw a jump in computer software and hardware, trading, automobile, construction (infrastructure) activities, construction development, drugs and pharmaceuticals and non-conventional energy. However, the services sector, telecommunications, and chemicals saw contraction in inflows.

 

With respect to states, Karnataka overtook Maharashtra and received the highest inflow of $5.69 billion during April-June period. Investment flows into the state also grew from $2.28 billion during the same period last year.

 

Overseas inflows in Maharashtra plunged to $5.36 billion in April-June from $8.48 billion in the same period last year.

 

Other states and UTs where FDI grew include Gujarat, Tamil Nadu, Uttar Pradesh, Rajasthan and Haryana.