According to government data, foreign direct investment inflows into the computer software and hardware, commerce, and construction industries sharply declined during the July–September quarter, resulting in a 7.3% year-over-year decline to $9.54 billion.
FDI equity inflows for the April–September period totaled $20.4 billion, a 24% decrease from the previous year. Reinvested earnings and other capital were included in the total FDI flows from April to September, which decreased 15.1% year over year to $33.1 billion. Since July 2022, monthly FDI inflows have been declining year over year, and during this time, start-up funding has sharply decreased.
The largest receivers of foreign direct investment (FDI) in India are services, trading, and computer software and hardware. Both of these categories saw a significant decline in the first half of the year.
The amount of foreign direct investment (FDI) into the service sector, which encompasses banking, finance, and business outsourcing, decreased to $3.8 billion from $4.1 billion in April to September of this year. The inflows into computer hardware and software fell to $ 920 million from $ 3.2 billion the previous year. Trade saw a drop in FDI from $4.7 billion to $525 million.
In 2020–21 and FY 2021–22, FDI equity inflows increased significantly, reaching a total of $58 billion annually. The amount of foreign equity investments returned to $46 billion in FY 23, matching earlier levels.
Nearly $5.2 billion in foreign direct investment (FDI) was channeled via Singapore from April to September. With inflows of $2.9 billion, Mauritius ranked as the second-largest source of foreign direct investment (FDI) during the period, behind Japan ($2.09 billion) and the US ($2.05 billion). The second quarter’s reduction in FDI came after a considerably more severe drop in exports from April to June, which dropped 34% to $10.9 billion.
