6 April 2024 – India is setting its sights on attracting a minimum of $100 billion in gross foreign direct investment (FDI) annually, with investors and multinational corporations increasingly seeking to diversify away from China. Rajesh Kumar Singh, secretary in the Department for Promotion of Industry and Internal Trade, shared this ambitious target, emphasizing India’s positive trajectory in FDI inflows.
The $100 billion goal represents a significant increase from the average annual FDI of over $70 billion in the past five years until March 2023. Despite global uncertainties impacting FDI levels last year, Singh expressed confidence that the current fiscal year’s FDI figures would approach the target.
India’s proactive approach aligns with the “China plus one” strategy, where businesses aim to mitigate geopolitical risks by expanding their operations beyond China. Major companies like Apple Inc. and Samsung Electronics Co. have capitalized on India’s incentives, bolstering their manufacturing presence in the country.
However, India’s share of global FDI inflows experienced a decline, contrasting with gains seen by other countries like the US, Canada, and Brazil. Despite strategic reforms and incentive measures, Kotak Institutional Equities noted a broad-based weakness in FDI inflows across various sectors.
While sectors such as electricity and IT continue to attract global interest, India’s FDI growth remains subdued, particularly in sunrise sectors. Kotak emphasized the need for India to focus on domestic markets while enhancing its presence in higher value-added exports.
