US Tops List of Foreign Direct Investors in India in FY23

• 13 Sep 2023

Recently, a census conducted by the Reserve Bank of India (RBI) revealed that the United States emerged as the leading source of foreign direct investment (FDI) in India during FY23.

Key Points

• US Leads FDI Inflow: According to RBI data, the US brought in Rs 8.58 lakh crore ($103 billion) in FDI in FY23, representing 17.2% of the share. This marked an increase from the previous fiscal year's Rs 8.05 lakh crore.
• Other Major Contributors: FDI from Mauritius was Rs 7.43 lakh crore, accounting for a share of 14.9%, while the UK contributed Rs 7.08 lakh crore, making up 14.2% of the total.
• Data Source: The census data was based on foreign liabilities and assets (FLA), encompassing cross-border liabilities and assets of various entities, including companies, limited liability partnerships, alternative investment funds, and partnership firms, with inward/outward direct investment (DI).
• Outward Direct Investment (ODI): Singapore, the US, the UK, and the Netherlands were among the top destinations for ODI by Indian entities, collectively receiving 60% of the Rs 9.1 lakh crore invested by Indian firms in FY23. Total ODI by Indian firms increased by 19.46% to Rs 9.11 lakh crore ($109 billion) in FY23.
• Market Value Growth: The census highlighted a 6.9% increase in the market value of FDI in India in FY23, primarily attributed to the rise in FDI in unlisted companies.
• Sector-wise Attraction: The manufacturing sector continued to attract the largest share of FDI equity, both at market value and face value.
• In the services sector, "Information & Communication" and "financial & insurance activities" were the primary recipients of FDI.
• Ownership: Non-financial companies retained the majority of FDI equity at face value, with the market value of FDI in unlisted firms surpassing that in listed companies.