India’sForeign Direct Investment (FDI)equity inflows declined for the first time in six years
in2018-19.Data released by theDepartment of Industrial Policy and
Promotionand internal trade
showed FDI equity inflows into Indiadeclined 1% to $44.4 billionin the year to 31 March. The decline signals a squeeze
inlong-term foreign
investmentinto the country.
The two sectors where FDI inflows dropped the
most are telecommunications (fell 57% to $2.7 billion) and pharmaceuticals
(dropped 74% to $266 million). Singapore dislodged Mauritius as a top source of
FDI, accounting for $16.22 billion inflows.
What is Foreign Direct
Investment (FDI)?
Foreign direct investment (FDI) is an investment
made by afirm or individual in one countryinto business interests located in another country.
Generally, FDI takes place when an investor establishes foreign
business operations or acquires foreign business assets, including
establishing ownership or controlling interest in a foreign company.
Foreign direct investments are distinguished from portfolio
investments in which an investor merely purchasesequities of foreign-based
companies.
