Decline in net foreign direct investment during April-November 2023


New Delhi: Net Foreign Direct Investment (FDI) in India has decreased during April-November 2023. It has come down to $13.54 billion as compared to $19.76 billion in April-November 2022. This is due to the decline in global financial inflows and the withdrawal of equity capital. The amount that remains after deducting the investment made from the amount of money coming into the country is called net FDI.

Reserve Bank of India data (January 2024 Bulletin) states that FDI into India during April to November 2023 was $21.39 billion and outflow was $7.85 billion. During the same period in 2022, FDI inflows were $29.11 billion and outflows were $9.3 billion.

According to the Reserve Bank, withdrawals/disinvestment by direct investors in India rose to $25.58 billion in the eight months of FY24 from $19.87 billion in April 2022.

According to the Reserve Bank's monthly bulletin on the state of the economy for January 2024, manufacturing, power and other energy sectors, transport, financial services, retail and wholesale accounted for two-thirds of total FDI equity inflows.

Mauritius accounts for the majority (69.9 percent) of equity inflows. Apart from this, money has also come from Singapore, Japan, America and Netherlands. According to a report by FDI Intelligence, India is among the 10 countries where investment momentum is likely to improve in 2024.

Increasing data center capacity is beneficial for India. This year the capacity will cross 1U and India will be in a position to become a global data center. This will have a positive impact on FDI, which has started to recover in the second half of 2023-24.

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