India’s gross FDI surged 26% to $42 bn in H1FY25

India’s gross foreign direct investment (FDI) surged by 25.7% to $42.1 billion during April-September 2024, compared to $33.5 billion in the corresponding period of the previous year, according to the data released by RBI (Reserve Bank of India). During April-September 2024 (H1FY25), the net FDI moderated to $3.6 billion, down from $3.9 billion in the corresponding period of the previous year, mainly due to increase in repatriation and outward FDI.

“Manufacturing, financial services, electricity and other energy sectors, and communication services contributed for around two-thirds of the gross FDI inflows. Singapore, Mauritius, the Netherlands, the UAE, and the US were sources for about three-fourths of the flows,” the RBI's November 2024 bulletin states.

Net outward FDI jumped to $10.7 billion during April-September 2024, up from $6.5 billion in the same period last year. Meanwhile, repatriation and disinvestment— investments made by investors in India surged to $27.8 billion in H1 FY25, compared to $23.1 billion in the same period of the previous year.

Net foreign portfolio investments (FPI) outflows hit a post-Covid high of $11 billion in October 2024, due to significant outflows from the equity segment. The financial services, oil, gas and consumable fuels, and fast-moving consumer goods (FMCG) sectors witnessed the most outflows during October 2024.

In October 2024, net FPI turned negative in Indian capital markets due to escalating global uncertainty from geopolitical tensions and rebalancing by global portfolio managers in the wake of recent Chinese stimulus measures and election outcomes in the US.

Net inflows into non-resident deposits amounted to $ 10.2 billion during April-September 2024, up from $ 5.4 billion a year ago. “Higher inflows were recorded in all three accounts, namely, Non-Resident (External) Rupee Accounts, Non-Resident Ordinary (NRO) and Foreign Currency Non-Resident accounts,” it adds.