India has ascended to the 15th position in the global Foreign Direct Investment (FDI) rankings for 2024, according to the latest report by the United Nations Conference on Trade and Development (UNCTAD). This signifies a step up from its 16th position in 2023. Despite a slight decrease in FDI inflows, India remains a dominant recipient in South Asia, attracting a significant portion of the region's total FDI.
The UNCTAD's 'World Investment Report 2025' indicates that while global FDI flows experienced an 11% decline, India's FDI inflows remained relatively stable at $28 billion in 2024. This stability is particularly noteworthy considering the global downturn in investment flows. Rebeca Grynspan, UN Trade and Development Secretary-General, highlighted that many economies are being left behind due to systemic issues that direct capital where it is easily accessible rather than where it is most needed.
While FDI inflows experienced a slight dip, India witnessed a surge in greenfield project announcements. The country ranked fourth globally with 1,080 new greenfield projects in 2024. These projects are crucial for bolstering infrastructure and digital capabilities in developing economies. Furthermore, Indian investors have been increasingly active in initiating greenfield projects abroad, with a 20% increase in such announcements, positioning India among the top 10 global investor countries. India also secured a place among the top five economies for international project finance deals, finalizing 97 transactions during the year.
Projected capital expenditures in India have seen a significant increase, rising by over 25% to reach $110 billion. This accounts for almost one-third of the total projected expenditures across Asia, reflecting a growing investor focus on India's manufacturing and digital economy sectors. The UNCTAD report suggests that the rise in India's manufacturing activity is primarily driven by investments in semiconductor and basic metals projects. The energy and gas sector continues to lead in terms of project value, representing 14% of total investment, with an average project size of $584 million. This growth is supported by India's national energy transition strategy, facilitated by blended finance models and investor-friendly policies.
According to data from the Department for Promotion of Industry and Internal Trade (DPIIT), FDI equity inflows stood at $50 billion during the financial year 2024-25, reflecting a 13% year-on-year increase. This indicates sustained investor confidence in the Indian market.
The services sector has emerged as the top recipient of FDI equity inflows in FY 2024-25, attracting 19% of the total inflows, followed by computer software and hardware at 16%. FDI into the services sector rose by 40.77% to $9.35 billion from $6.64 billion in the previous year. There has also been a strong surge in manufacturing FDI, which grew by 18% in FY 2024–25, reaching $19.04 billion compared to $16.12 billion in FY 2023–24.
Maharashtra accounted for the highest share (39%) of total FDI equity inflows in FY 2024–25, followed by Karnataka (13%) and Delhi (12%). Singapore remains the top source country for FDI, with a 30% share, followed by Mauritius (17%) and the United States (11%).
Overall, the increase in FDI inflows, greenfield projects, and capital expenditures underscores India's growing prominence as a global investment destination. Government reforms, liberalization of FDI norms, and initiatives like Make in India have played a crucial role in attracting foreign investments across various sectors, contributing to the country's economic growth and development.
