Gujarat receives highest FDI in FY21; Maharashtra ranks second

India has attracted the highest ever total FDI (foreign direct investment) inflow of $81.72 billion during the financial year 2020-21, recording a 10 per cent rise on a year-on-year basis, shows the commerce and industry ministry's latest data.

Among states, Gujarat received the highest FDI at 37 per cent of the total equity inflows. Maharashtra and Karnataka had the second and third highest flow at 27 per cent and 13 per cent, respectively.

Gujarat has bagged the top spot in terms of the highest FDI for the fourth consecutive year now. With a 37 per cent share, Gujarat received a total FDI of $30.23 billion in 2020-21. Almost 94 per cent of the investment that came in Gujarat during 2020-21 was in the computer hardware and software sector, the state statement said. The state accounts for 78 per cent of the country's total FDI inflow in this sector.

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The latest data available on the department for the promotion of industry and internal trade (DPIIT) for the April-December 2020 period shows Gujarat bagging a lion's share of Rs 1.77 lakh crore FDI. The state-wise FDI inflow data for the January-March quarter is not available on DPIIT yet.

Maharashtra managed to rake in Rs 1.53 lakh crore FDI, while Karnataka stood third with investment worth Rs 78,160 crore. Delhi bagged fourth place and attracted foreign direct investment worth Rs 59,830 crore during the April-December period.

Also read: Global FDI reached 15-year low in 2020, China overtakes US: OECD data

Tamil Nadu and Jharkhand, which were placed on the seventh and eighth spots, attracted investment worth Rs 19,734 crore and Rs 19,200 crore, respectively.

Haryana bagged FDI worth Rs 13,661 crore; Telangana Rs 11,332 crore; West Bengal Rs 4,309 crore; and UP Rs 4,103 crore.

In terms of year-on-year growth, FY20 recorded a 20 per cent rise in FDI, while in FY21 the FDI growth was hampered by the Covid-19 pandemic but still managed to clock in 10 per cent growth.

Also read: No economic quid-pro-quo with China; no fast-tracking of FDI, says senior cabinet minister

In terms of top investor countries, Singapore is at the top with 29 per cent, followed by the US (23 per cent) and Mauritius (9 per cent) for the FY21.

Construction (infrastructure) activities, computer software and hardware, rubber goods, retail trading, drugs and pharmaceuticals and electrical equipment have recorded more than 100 per cent jump in equity during the FY 2020-21 as compared to the previous year.

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Out of the top 10 countries, Saudi Arabia was the top investor in terms of percentage increase during FY21. It invested $2,816.08 million in comparison to $89.93 million reported in the previous financial year. The US and the UK also recorded 227 per cent and 44 per cent increase in FDI equity inflow on a YoY basis in FY21.

India best performer in terms of FDI inflows 

As per a report released by UNCTAD, the global FDI collapsed in 2020, falling 42 per cent from $1.5 trillion in 2019 to an estimated $859 billion. The FDI saw such a low level in the 1990s and it's even 30 per cent lesser than the global foreign investment seen after the 2008-09 global financial crisis. In the year 2020, when the Covid-19 pandemic ravaged major economies, countries like the UK, the US, Germany, Italy, Russia, etc, were among the most hit nations with a drop in FDI. Despite worse economic conditions due to the impact of Covid-19, India recorded a positive growth of 13 per cent in the year 2020, which is the highest among all major economies.

Also read: India bucks global decline in FDI; grows 13% against world's 42% fall in 2020