India trumps US, China as No.1 FDI destination
According to the FT data service, India beat US and China to emerge as the top environment for foreign direct investment. India emerged as number 1 with $4 billion more than America and $3 billion more than China according to the ranking of the top destinations for greenfield investment (measured by estimated capital expenditure) for the first half of 2015.
According to the World Investment Report 2015 released by the United Nations Conference on Trade and Development (UNCTAD), India was placed in the list of top 10 destinations for FDI in 2015. FDI inflows to India are expected to rise in 2015 as the economy gained ground in the previous year. India moved to the third position as top prospective FDI hub from fourth.
FDI into India saw a 48% growth in the 7 month period since the launch of 'Make in India' initiative on 25 September 2014.
PM Modi's visits to the 12 countries in the financial year 2014-15 resulted in India receiving as much as $19.78 billion in Foreign Direct Investment (FDI) from those countries. Commerce and Industry Minister Nirmala Sitharaman said that the total outflow and inflow of foreign investment in general for 2014-15 fiscal was $6.42 billion and $75.71 billion, respectively.
India's manufacturing sector witnessed an almost 50% jump in foreign direct investment (FDI) after a 3 year decline in the year 2014-15. Reserve Bank of India in its annual report recorded a benchmark growth of 54% for the financial year 2014-15. The average FDI went up to $24.7 billion from $16 billion (2013-14). The other major gainer was the computer services industry.
The top source of India's FDI is Mauritius with $9.03 billion in 2014-15 accounting for 29% of India's total FDI flow, whereas Singapore came 2nd with $6.74 billion inflow.
The growth in foreign direct investment in India is not so much because India has "improved its business environment significantly", but mostly because China is going through a slump. Finance Minister Arun Jaitley's efforts to relax land acquisitions and labour laws at the state and central level and aiming to resolve tax cases are being seen in a positive vein by the FDI players.
India also climbed up 16 places to 55th on global competitiveness index which underlines the country's recent economic recovery.
