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In the last couple of months, we have seen large foreign direct investment (FDI) commitments into India by United States (US) technology giants in the artificial intelligence (AI) infrastructure domain. This has brought to the fore India’s attractiveness as an FDI destination, especially for new-age sectors. In recent years, India has witnessed healthy gross FDI inflows across manufacturing and services. However, this has been accompanied by a sharp increase in the repatriation of profits and FDI outflows from India, resulting in a narrowing of net FDI flows.
Over the last five years, India’s annual gross
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