India's FDI inflows increased after lockdown and April policy tweak

Source :Sify
Author :Finance Desk
Last Updated: Wed, Oct 21st, 2020, 15:53:11hrs
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FDI

New Delhi: The pandemic of Coronavirus and a nationwide lockdown that began in March did not dampen India's FDI inflows.

In fact, a crucial policy tweak in April, also may not have affected FDI inflows.

Latest data from India's Commerce Ministry reveals inflows into India in the form of Foreign Direct Investment (FDI) grew by 13 percent (Apr - Aug' 2020) on a year-on-year basis.

According to the ministry, $35.73 billion was received during the period under review. In a statement, it added, "It is the highest ever for first 5 months of a financial year and 13 per cent higher as compared to first five months of 2019-20 ($31.60 billion)..."

"FDI equity inflow received during F.Y. 2020-21 (April to August, 2020) is $27.10 billion. It is also the highest ever for first 5 months of a financial year and 16 per cent more compared to first five months of 2019-20 ($23.35 billion)."

Besides, the ministry's data showed that FDI inflows have risen by 55 per cent during the last 6 years.

"Total FDI inflow grew by 55 per cent, i.e. from $231.37 billion in 2008-14 to $358.29 billion in 2014-20," the statement said.

"FDI equity inflow also increased by 57 per cent from $160.46 billion during 2008-14 to $252.42 billion (2014-20)."

The ministry said that measures taken regarding FDI policy reforms, investment facilitation and ease of doing business have resulted in increased inflows into the country.

"Continuing on the path of FDI liberalisation and simplification, Government has carried out FDI reforms across various sectors," the statement said.

The note added, "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. The following trends in India's Foreign Direct Investment are an endorsement of its status as a preferred investment destination amongst global investors."

The growth is reported for a time period that saw news related to tensions with China. On April 17 2020, India passed a crucial decision that restricted FDI from neighboring country (sharing land border). Such proposals had to be routed to the government for approval.

The note from the ministry does not indicate details of FDI according to country of origin.
 

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