FDI in India shrinks by 50 per cent in October

29 December 2011: FDI into India decreased by over 50 per cent to $1.16 billion in October for the second month in a row.

The country had received $2.33 billion overseas investment in the same month last year. In September, the inflows were at $1.76 billion, down by 16.5 per cent Y-o-Y. However, during the April-October period, the FDI went up by 50.3 per cent to $20.8 billion, from $13.84 billion in the year-ago period as inflows were robust in the initial months.

While in August foreign investment inflows had increased over two-fold to $2.83 billion, Y-o-Y, in July they declined after a significant jump for two consecutive months -- May and June. Despite uncertainties in the global economy, FDI may touch $35 billion in 2011-12, as against $19.4 billion in the last fiscal on account of major deals like RIL-BP and POSCO. In 2010-11, equity inflows through the FDI route had dipped 25 per cent to $19.43 billion, from $25.6 billion in 2009-10. In 2008-09, FDI stood at $27.3 billion.

According to experts, uncertain economic conditions in the US and Europe are one of the major reasons for the declining FDI in India.

Source: Business standard