- India’s FDI inflows are expected to grow strongly in 2026, supported by robust macroeconomic fundamentals, large investment announcements, policy reforms, and investment-linked trade agreements.
- The government continues to review and update FDI policy regularly through stakeholder consultations to keep India investor-friendly.
- DPIIT and the Commerce Ministry have focused on speeding up approvals, simplifying processes, and improving ease of doing business.
- Investor confidence is supported by stable returns, a skilled workforce, reduced compliance burden, decriminalisation of minor offences, and streamlined regulations.
- Total FDI crossed $80.5 billion in 2024-25 despite global uncertainties, with gross overseas investments exceeding $60 billion during January-October 2025.
- The government expects FDI inflows in 2026 to surpass the record $80.62 billion achieved last year.
- India is banking on its trade pact with the European Free Trade Association (EFTA), which includes a $100 billion FDI commitment over 15 years.
- The EFTA agreement came into force in October 2025, with Roche Pharma committing ₹17,000 crore in fresh FDI over five years.
- New Zealand has also committed $20 billion in investments under its trade pact with India, expected to be implemented in 2026.
- According to UNCTAD, while global FDI declined by 11% in 2024, India and other Asian economies continued to see strong investment activity.
- Major global firms have announced large investments, including Microsoft ($17.5 billion by 2030), Amazon ($35 billion over five years), and Google ($15 billion over five years).
- Apple and Samsung are expanding manufacturing in India, while ArcelorMittal Nippon Steel is increasing capacity by 2026.
- India’s economy grew 8.2% in Q2 FY26, strengthening investor sentiment.
- The Jan Vishwas Bill (2.0) aims to further improve ease of doing business by reducing regulatory friction.
- Experts expect increased long-term FDI into services, software, electronics, AI, cloud infrastructure, and Global Capability Centres.
- GCC countries are emerging as a strategic and durable source of foreign investment for India.
- Mauritius and Singapore remain the largest investors, followed by the US, Netherlands, Japan, and the UK.
- Key sectors attracting FDI include services, IT hardware and software, telecom, automobiles, chemicals, pharmaceuticals, and construction.
- Most sectors allow FDI through the automatic route, while a few require government approval, and some sectors remain prohibited.
- Strong FDI inflows are critical for infrastructure development, economic growth, balance of payments stability, and supporting the rupee.
