Maharashtra and Delhi’s National Capital Region accounted for over 50 per cent of the Foreign Direct Investment (FDI) inflows into the country during the first quarter of 2010-11, says industry ministry’s latest data.
Maharashtra attracted maximum foreign inflows at $ 1.53 billion (Rs. 6,989 crore) and accounted for 35 per cent of the country’s total FDI during April-June this fiscal.
Delhi’s National Capital Region (NCR) including parts of Uttar Pradesh and Haryana, received $ 1.51 billion FDI during the first three months of the current financial year.
NCR accounted for 21 per cent of the country’s total FDI.
During April-June 2010-11, India received $ 5.80 billion foreign inflows, the data said.
According to experts, the main reason for the maximum inflows in Maharashtra and NCR is substantial improvement in the infrastructure and pro-active approach of the respective governments.
“Infrastructure in these areas has improved considerably and that is making them attractive destination for FDI in India,” said Rakesh Joshi, an international trade expert at Indian Institute of Foreign Trade.
“Maximum FDI comes in finance sector and Mumbai (in Maharashtra) is the hub for that,” former Director of economic think-tank ICRIER Rajive Kumar said.
Karnataka attracted the third highest FDI inflows worth $ 353 million during the period, followed by Andhra Pradesh ($ 301 million), Goa ($ 290 million), Tamil Nadu ($ 272 million) and Gujarat ($ 144 million).
FDI in different states in India has increased steadily since the early 1990s when the Indian economy was opened up to foreign investments, Joshi said.
Sectors, which attracted maximum FDI include services, telecommunication, metallurgical industries, power, computer hardware and software, and construction activities.
The highest FDI of $ 1.86 billion came from Mauritius followed by Singapore ($ 938 million), Japan ($ 437 million) and the Netherlands ($ 343 million) in April-June 2010-11.
The government is making sustained efforts to make the FDI policy regime more attractive and investor friendly, with a view to attract investments from all major investing nations.
The government had floated discussion papers for public comments to liberalise FDI in multi-brand retail and defence sector.
The FDI for 2009-10 at $ 25.88 billion was lower by five per cent from $ 27.33 billion in the previous fiscal.