India receives FDI inflows worth $40b during April-September period
FDI policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into India.
Addressing the inaugural session of CII’s Partnership Summit 2020, through virtual means, Minister of Railways, Commerce & Industry, Consumer Affairs and Food & Public Distribution Goyal invited foreign investors to be a part of India’s growth story.
The Minister said continuing on an open path, India has been systematically opening up new sectors of the economy. He said that FDI (Foreign Direct Investment) flows in India have been continuously growing.
“During the first nine months of this year, at the peak of Covid-19 pandemic, our FDI has grown. We have one of the most facilitative FDI policies in the world. During the April-September period, FDI inflows are at $40 billion, which has been higher than last year by about 13 per cent,” he said.
“Last year, we announced one of the most attractive tax rates available anywhere in the world at 22 per cent tax for businesses in India and 15 per cent tax for new manufacturing facilities set up after October 2019.” Besides, Goyal cited that a number of new schemes have been introduced, including ‘Production-Linked Incentive’ scheme to attract industries to come to India.
“We have investment promotion cells in all the ministries. Central government and the states are working together to attract and promote investments even before the onset of the pandemic, India was rapidly announcing a slew of reform measures aimed at improving the economy and productivity levels in the economy.
“India is introducing conducive reforms and facilitation measures to encourage greater global involvement in our V-shaped recovery. I invite you to board the bus of development, growth and prosperity that Prime Minister Shri Narendra Modi is crafting for the people of India,” said Goyal.
India receives highest ever FDI in April-August of financial year (FY21), says government.
India, in April-August 2020, received the highest ever total Foreign Direct Investment (FDI) for the first five months of a financial year, the commerce and industry ministry said in a statement.
The total FDI inflow into India in the first five months was $35.73 billion, 13 per cent higher than that in the same period last fiscal.
“FDI equity inflow received during FY21 (April to August, 2020) is $27.1 billion. It is also the highest ever for first five months of a financial year,” the ministry said. This is 16 per cent higher than the inflows witnessed in the first five months of 2019-20 which were $23.35 billion.
Stating that these trends are an endorsement of India’s status as a preferred investment destination amongst global investors, the government said: “Measures taken by the government on the fronts of FDI policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into the country”.
Total FDI into India in the first quarter of 2020-21 plunged by 60 per cent from the year-ago period to $6.5 billion, data released by the department for promotion of industry and internal trade (DPIIT) showed last month. India’s performance was worse than the global projections by the United Nations Conference on Trade and Development (UNCTAD).
The agency in March had revised its projections about the impact of outbreak and spread of Covid-19 on global FDI. The multilateral agency expects the downward pressure on global FDI to be -30 per cent to -40 per cent in FY21, much higher than its earlier projection of -5 per cent to -15 per cent pressure.
As per the statement, the government’s intent is to make the FDI policy more investor friendly and remove the policy bottlenecks that have been hindering the investment inflows into the country.
“The steps taken in this direction during the last six years have borne fruit as is evident from the ever increasing volumes of FDI inflows being received into the country,” it said.
Total FDI inflow grew 55 per cent from $231.37 billion in 2008-14 to $358.29 billion in 2014-20 while FDI equity inflows rose 57 per cent from $160.46 billion to $252.42 billion in the same period.
Investment climate in India has improved considerably since the opening up of the economy in 1991.
This is largely attributed to ease in FDI norms across sectors of the economy.
India, today is a part of top 100 club on Ease of Doing Business (EoDB). FDI inflows in India stood at $45.15 billion in 2014-15 and have consistently increased since then. Moreover, total FDI inflow grew by 55 per cent, i.e. from $231.37 billion in 2008-14 to $358.29 bn in 2014-20 and FDI equity inflow also increased by 57 per cent from $160.46 billion during 2008-14 to $252.42 billion (2014-20).
FDI inflows in India increased to $55.56 billion in 2015-16, $60.22 billion in 2016-17, $60.97 billion in 2017-18 and the country registered its highest ever FDI inflow of $62.00 billion (provisional figure) during the last Financial Year 2018-19. Moreover, India has attracted more than $74 billion investments across sectors during 2019-20.
