Net FDI into India falls to $0.4 bn in FY25 amid repatriation surge

'It's sign of a mature market where foreign investors can enter and exit smoothly,' says RBI report

Net foreign direct investment (FDI) in India crashed by more than 96 per cent to $0.4 billion in FY25 from $10.1 billion a year ago due to higher repatriation and outward flow. Net FDI was $ 28.0 billion in FY23.

 

The decline in FY25 is “a sign of a mature market where foreign investors can enter and exit smoothly, which reflects positively on the Indian economy,” said the State of the Economy report by the Reserve Bank of India (RBI) in its monthly bulletin (May 2025).

 

Gross FDI remained elevated in FY25, with 13.7 per cent year-on-year (Y-o-Y) growth to clock $81 billion worth of flows. It was $ 71.3 billion in (FY24) and 71.4 in FY23, according to RBI data. 

 

 

More than 60 per cent of gross FDI inflows in FY25 were in manufacturing, financial services, electricity and other energy, and communication services sectors. Singapore, Mauritius, the UAE, the Netherlands, and the United States (US) accounted for more than 75 per cent of the flows, said the report.

 

Repatriation/disinvestment by those who made direct investments in India increased to $51.5 billion in FY25 from $ 44.5 billion in FY24 and $ 29.3 billion in FY23.

 

Overseas investments made by Indian companies (outward FDI) increased to $ 29.2 billion in FY25 from $16.7 billion a year ago and $14 billion in FY23. Singapore, the US, United Arab Emirates, Mauritius and The Netherlands together accounted for more than half of the rise in outward FDI.

 

Financial, banking and insurance services, followed by manufacturing; wholesale, retail trade, restaurants and hotels accounted for more than 90 per cent of outward FDI, said the report.