In a pandemic-ravaged year, India managed to receive the highest ever foreign direct investment during FY21 at $81.72 billion. This happens to be 10% higher than $74.39 billion in the previous fiscal. Foreign direct investments (FDI) into the country grew 19% to $59.64 billion during 2020-21 on account of measures taken by the government on the fronts of policy reforms, investment facilitation, and ease of doing business. Singapore was the biggest investor in India last fiscal, accounting for 29% FDI, followed by the United States at 23% and Mauritius at 9%.
The Computer software and hardware segment received the most FDI in FY21, accounting for 44% of the total FDI equity inflow. Construction (infrastructure) activities and services sector followed with 13% and 8% share, respectively. The major recipient states in the Computer software and hardware segment are Gujarat (78%), Karnataka (9%), and Delhi (5%).
Among states, Gujarat received the highest FDI at 37% of the total equity inflows. Maharashtra and Karnataka had the second and third highest flow at 27% and 13%, respectively. The majority of the equity inflow of Gujarat has been reported in the sectors ‘Computer Software & Hardware’ (94%) and ‘Construction (Infrastructure) Activities’ (2%) during the FY21.
The major sectors, namely Construction (Infrastructure) Activities, Computer Software & Hardware, Rubber Goods, Retail Trading, Drugs & Pharmaceuticals, and Electrical Equipment have recorded more than 100% jump in equity during the FY21 as compared to the previous year.
On the list of top 10 countries, Saudi Arabia became the biggest investor in terms of percentage increase during FY21, as it invested $2816.08 million compared to $89.93 million reported in the previous financial year. Other countries include the USA and the UK, which increased their share in FDI equity inflow by 227% and 44% during the FY21 compared to FY20.