Net FDI into India slows to $2.2 billion

Subrata Panda/Business Standard

Net foreign direct investment (FDI) into the country has slowed considerably, with latest data released by the RBI in its December bulletin showing that it decelerated to $2.1 billion during April-October 2024 from $7.7 billion a year ago, majorly due to the rise in repatriation and net outward FDI.
 
On the other hand, gross inward FDI rose to $48.6 billion during April-October 2024 from $42.1 billion a year ago.
 
The slowdown in net FDI into India is consistent with trends observed in other emerging market economies, including Mexico, Vietnam, Indonesia, the Philippines, and Thailand among others.
 
According to the state of the economy report in the December bulletin, while repatriation rose to $34.1 billion during the April-October period from $26.4 billion a year ago, net outward FDI increased to $12.4 billion from $ 8.0 billion.
 
More than 60 per cent of the gross FDI inflows were directed to manufacturing, financial services, electricity and other energy, and retail and wholesale trade sectors.
 
 Major source countries included Singapore, Mauritius, the UAE, the Netherlands, and the US, contributing more than three-fourths of the flows during the period,  RBI said in the state of the economy report.
 
In the recently concluded monetary policy meeting, the governor had noted that while gross FDI to India increased at a robust pace during the first half of the year, net FDI, however, moderated during this period due to higher repatriations and rising outward FDI.