Understanding India's record FDI flows, in charts
SummaryForeign direct investment (FDI) into India hit a record high in 2021-22. While that reflects continuing foreign interest in the Indian economy, there are reasons to be circumspect, notably for the small draw that is manufacturing and the capital moving out of India. Net FDI inflows, or inflows minus outflows, were the lowest since 2018-19.
In 2021-22, gross foreign direct investment (FDI) inflows into India increased for the ninth consecutive year to $83.5 billion, an all-time high. The Indian central bank defines FDI as investments made by those residing outside India in an unlisted company or 10% or more of a listed company. Amid an uncertain external economic environment, the increased FDI is being pitched by many, including finance minister Nirmala Sitharaman, as a vote of confidence in the Indian economy .