FDI inflow increases by 18% to $46 billion in 2016: DIPP

February 27, 2017

According to data released by the Department of Industrial Policy and Promotion (DIPP), India attracted $46 billion foreign direct investment (FDI) in 2016.
It shows that, India’s FDI grew by 18% in 2016 as compared to $39.32 billion FDI inflows in 2015.

Key Facts

The main sectors which attracted the highest FDI inflows included services, telecom, trading, computer hardware and software and automobile.
Bulk of the FDI came in from Singapore followed by Mauritius, Netherlands and Japan.

Background

Foreign investments are considered crucial for India as it needs around 1 trillion dollars for overhauling its infrastructure sector such as ports, airports and highways to boost growth.
Strong inflow of foreign investments mainly helps to improve the country’s balance of payments (BoP) situation and also strengthen the rupee value against other global currencies, especially dominant US dollar.
To attract inflow of foreign investments, the central government has announced several measures including liberalisation of FDI policy and improvement in business climate.
In the Budget 2017-18, Finance Minister further announced relaxation of foreign investment norms and also abolished Foreign Investment Promotion Board (FIPB).

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