Net FDI in India dips to $14.55 billion in April 2023-Februray 2024

Repatriation\divestment crosses $38 billion in 11 months

The net foreign direct investment (FDI) in India, inflows minus the outflows, dropped sharply by 45.5 per cent in the 11 months of Financial Year 2024 (April 2023 to February 2024), when compared with the same period a year ago due to a rise in repatriation of capital. 

The net FDI stood at $14.55 billion in April-2023-February 2024 period, down from $26.71 billion in the same period a year ago.

The Reserve Bank of India’s (RBI) data (April 2024 bulletin) said FDI in India was $26.69 billion and outflows were $ 12.14 billion in April 2023-February 2024.

In the same period last year (April 2022-February 2023), FDI inflows were at $ 39.61 billion, while outflows had touched $12.90 billion during the same period.

Repatriation/disinvestment by those who made direct investments in India rose to $38.30 billion in the 11-months of FY24 from $27.17 billion in April 2022-February 2023, according to RBI data.

According to the “State of Economy” report in RBI’s monthly bulletin for April 2024, more than 60 per cent of the FDI equity flows were directed towards manufacturing, computer services, electricity and other energy, retail and wholesale trade, and financial services.

The major source countries were Singapore, Mauritius, the US, the Netherlands, Japan and the UAE, accounting for around 80 per cent of the flows.

Amidst an uncertain global investment environment, India held its position as a favourable investment destination among peer Asian economies in 2023.

India ranked fourth among Emerging Market Economies (EMEs) in the 2024 FDI Confidence Index, reflecting continued optimism over its growth potential.

Additionally, India has signed a Trade and Economic Partnership Agreement (TEPA) with the European Free Trade Association (EFTA), which includes investment commitments, it said.

Another article on India’s services exports in the April 2024 bulletin said these exports, both traditional and modern, are influenced by many factors including world demand, exchange rate, manufacturing exports, infrastructure, robust institutions, foreign direct investment (FDI) and financial development.