Foreign direct investment (FDI) flows into India grew 10% in 2020-21 to touch a record $81.72 billion, with FDI equity inflows rising 19% to almost $60 billion, the Commerce and Industry Ministry said on Monday.
Singapore emerged as the top investor with almost a third of all investments, followed by the U.S. which accounted for 23% of FDI and Mauritius from where 9% of the foreign capital flows originated.
FDI equity flows from the U.S. more than doubled during the year compared with 2019-20, while investments from the U.K. surged 44%. However, the sharpest growth among the top 10 FDI-origin countries was recorded from Saudi Arabia. Investments from the oil-rich nation jumped from a mere $90 million in 2019-20 to $2.8 billion last year.
Gujarat was the top FDI destination in the year gone by, accounting for 37% of the foreign equity inflows followed by its traditional industrial rival Maharashtra which got 27% of the equity inflows.
Karnataka accounted for another 13% of the equity investments, indicating that the rest of the country got a disproportionately less 23% of foreign equity capital.
“Computer software and hardware has emerged as the top sector during 2020-21 with about 44% share of the total FDI equity inflow followed by construction (infrastructure) activities (13%) and services sector (8%), respectively,” the Ministry said.
As much as 94% of the equity FDI into Gujarat was routed into the computer software and hardware sector, with the State accounting for 78% of the total investments into the sector. Karnataka, with 9% of FDI equity receipts into the sector, was followed by Delhi which received 5%.
In 2019-20, India had received $74.39 billion in FDI, with almost $50 billion coming in the form of equity investments.
“Construction (infrastructure) activities, computer software and hardware, rubber goods, retail trading, drugs and pharmaceuticals and electrical equipment have recorded more than 100% jump in equity during 2020-21,” the statement pointed out.
