Singapore leads in FDI inflows in India in FY22; Karnataka bags highest investments

Singapore, the USA, Mauritius, Netherland, and Switzerland have emerged as the top five countries for FDI equity inflows into India in FY22, the Ministry of Commerce & Industry said in a statement on Thursday.

As per the data shared by the Ministry, Singapore has emerged as the top sourcing nation with a contribution of 27.01 per cent, followed by the USA at 17.94 per cent.  Mauritius, The Netherlands and Switzerland follow the top two nations with contributions standing at 15.98 per cent, 7.86 per cent and 7.31 per cent, respectively.

The Commerce Ministry added that as per the UNCTAD World Investment Report (WIR) 2022, India had moved a notch higher to 7th rank among the top 20 host economies for 2021 in terms of FDI inflows.

India’s manufacturing sector attracted FDI Equity inflow to the tune of $21.34 billion in FY22, up 76 per cent from $12.09 billion in FY21, thus cementing its position as one of the most preferred investment avenues for overseas investors. In FY22, India received the highest annual FDI inflows of $84.835 billion, which exceeded the previous fiscal year by $ 2.87 billion.  

As per the Commerce Ministry, Computer Software & Hardware sector bagged the highest FDI inflow in FY22 at 24.60 per cent, followed by the Service sector at 12.13 per cent and the automobile industry at 11.89 per cent.

Statewise, Karnataka led the pack in with a share of 37.55 per cent of the total FDI inflow in FY22, followed by neighbouring state Maharashtra at 26.26 per cent and national capital Delhi at 13.93 per cent. The ministry further added that during FY22, FDI was reported from 101 countries, marking an increase from 97 countries during FY21.

Indian government allows FDI up to 100 per cent in non-critical sectors through the automatic route without security clearance from the Ministry of Home Affairs (MHA). Prior government approval or MHA’s security clearance is required for investments in sensitive sectors such as defence, media, telecommunication, satellites, private security agencies, civil aviation and mining, besides any investment from Pakistan and Bangladesh.