Why in News?
FDI inflows into India have crossed the USD one trillion milestone in the April 2000-September 2024 period, firmly establishing the country’s reputation as a safe and key investment destination globally.
Key Findings
Foreign direct investment in India: Important sectors and Nations
- The most important sectors ranked in terms of the inflows include: services, computer software, telecommunications, trading, construction, automobile, chemicals, pharmaceuticals.
- Mauritius is highest with 25%, followed by Singapore with 24%, the USA has 10%, Netherlands, 7%, Japan 6%, UK 5%, UAE 3%, Cayman Islands, Germany, and Cyprus all have 2%.
- A Foreign Direct Investment (FDI) is an investment done by a firm or any individual in one country into business interests located in another country.
- Usually, these actions are establishing new subsidiaries, acquisitions or mergers between existing foreign companies, or forming a joint venture.
- FDI is one of the important non-debt financial resources for economic development for India.
- FDI in India does not cover the purchases of stocks and bonds of a company, which is a feature of Foreign Portfolio investment (FPI).
Foreign Portfolio Investment (FPI) is the investments made by foreign entities in a country’s financial markets, such as stocks, bonds, or other securities, without taking a controlling interest in any company.
FPI in News: FPI inflow rises to ₹ 24,000 cr in 1st week of Dec
