India tops in FDI for new projects in Jan-June

In January-June, India attracted $31 billion (Rs 2.05 lakh crore) in capital expenditure (capex) from foreign companies.

India saw the highest foreign direct investment (FDI) inflow for new projects among all nations in the first half of calendar year 2015, beating America and China, British newspaper Financial Times said. 

In January-June, this country attracted $31 billion (Rs 2.05 lakh crore) in capital expenditure (capex) from foreign companies, China, the largest economy in Asia, attracted $28 bn and the US got $27 bn in the period.

“With its economic growth outstripping most rivals and bucking a downward trend among emerging markets, India is in pole position to pass China and the US in the FDI league tables this year,” the newspaper said.

This comes when FDI into emerging markets (EMs) as a group is falling. Research from fDi Markets found 97 of 154 countries typically classed as EMs experiencing declines in capex on such projects in the first six months of this year, compared with the same time period last year, FT added.

“In the past one year, the government has initiated a number of measures to improve the investment climate and ease of doing business. Several policy initiatives and reforms have also been undertaken. The higher FDI inflows are reflective of the growing positive sentiment about India as an investment destination,” economic affairs secretary Shaktikanta Das told Business Standard.

The report said for several years, China and the US had vied for top position in FDI inflow. It was nearly a draw last year, with the US number one by number of projects and China coming first by capex, according to data from fDi Markets.

India ranked fifth last year for capital investment, after China, the US, Britain and Mexico.

In a year when many other major FDI destinations posted declines, India experienced one of calendar year 2014’s best FDI growth rates, increasing its number of projects by 47 per cent, the paper said.

“India is tracking well ahead of where it was at this time last year: it has more than doubled its midyear investment levels, attracting $30 bn by the end of June 2015 compared with $12 bn in the first half of last year,” it said.