Enthused by a record foreign investment inflow, India is optimistic of continuing to be one of the world’s favourite Foreign Direct Investment (FDI) destinations in 2020 on the back of the Modi government’s liberalised norms and a significant jump in the ease of doing business ranking.
Despite a slowdown in the global economy, foreign investment inflows have not been impacted, Secretary of Department for Promotion of Industry and Internal Trade (DPIIT) Guruprasad Mohapatra said.
India received a $27.2 billion foreign investment in the first half of 2019 and the pace is said to have sustained thereafter.
The healthy growth in the overseas investments is proving that there is a lot of optimism and enthusiasm about India as a foreign investment destination, he said.
He added that all the ministries, departments and states are working to address issues and providing stable policies to facilitate entry of foreign companies.
“FDI growth has been very good this year and I am quite hopeful that with these policies and initiatives, India’s FDI story will continue unabated and continue to grow at a healthy rate,” Mr. Mohapatra said.
Mohapatra said that improvement in the business environment gives a pleasant experience to foreign investors as it helps in making processes easier.
“Some of the states are also wooing investments. So we need to further work on the areas in which the investments …are coming and see how quickly and seamlessly, we can give them approvals. These are the challenges and we are working on that,” he added.
When asked about the global companies which are looking to shift their bases from China to India, he said the government is focusing on those firms which are looking at India as a second investment destination.
“We know which companies are keen to invest in India and we are looking at them to see what help we can provide in terms of hand-holding, and in terms of support,” he said.
In the World bank’s ease of doing business report, India’s rank has improved to 63rd this year among 190 economies from 77th last year.
In the April-June period of the current fiscal, overseas investments increased by 28% to $6.3 billion. In 2018-19, total FDI into the country stood at $62 billion, an increase from $60.1 billion in 2017-18.
India mainly attracts investments from countries like Mauritius, Singapore, Japan, the U.K., the Netherlands, the U.S., Germany, Cyprus, France, and the U.A.E.
The sectors that received maximum FDI include services, computer hardware and software, construction development, trading, automobile, pharmaceuticals, chemicals, and power.