How Did India's FDI Inflows Surge 14% to Exceed $81 Billion in 2024–25?

New Delhi, May 27 (NationPress) India's FDI inflows have surged to $81.04 billion in FY 2024-25, reflecting a remarkable 14 percent growth from $71.28 billion in FY 2023–24, as reported by the Ministry of Commerce and Industry on Tuesday.

The annual flow of FDI into India has consistently increased over the past 11 years, rising from $36.05 billion in FY 2013-14. This growth is attributed to investor-friendly policies that allow 100 percent FDI in most sectors through the automatic route, according to the statement.

The services sector was the leading recipient of FDI equity in FY 2024–25, accounting for 19 percent of total inflows, followed closely by computer software and hardware at 16 percent, and trading at 8 percent. Notably, FDI in the services sector increased by 40.77 percent, rising from $6.64 billion to $9.35 billion.

India is also emerging as a center for manufacturing FDI, which saw an 18 percent increase in FY 2024–25, amounting to $19.04 billion, compared to $16.12 billion in FY 2023–24.

Maharashtra led the states with the highest share of FDI equity inflows at 39 percent, followed by Karnataka at 13 percent and Delhi at 12 percent.

In terms of source countries, Singapore dominated with a 30 percent share, followed by Mauritius at 17 percent and the United States at 11 percent.

Over the last eleven financial years (2014–25), India has attracted FDI totaling $748.78 billion, showing a 143 percent increase over the previous eleven years (2003–14), which garnered $308.38 billion in inflows. This represents nearly 70 percent of the total $1,072.36 billion in FDI received over the last 25 years.

Moreover, the number of countries investing in India has risen from 89 in FY 2013–14 to 112 in FY 2024–25, highlighting India's growing global reputation as an investment hub.

On the regulatory front, the government has implemented transformative reforms across various sectors to liberalize FDI norms. Between 2014 and 2019, significant changes included raising FDI caps in sectors such as defense, insurance, and pensions, along with relaxed policies for construction, civil aviation, and single-brand retail trading, the statement noted.

From 2019 to 2024, major initiatives included allowing 100 percent FDI under the automatic route in coal mining, contract manufacturing, and insurance intermediaries. The Union Budget for 2025 also proposed raising the FDI limit from 74 percent to 100 percent for companies investing their entire premium within India.