According to the latest statistics, available the country received FDI of US$3.8 billion in March, which is the highest inflow received so far in a single month. Further, during the fiscal 2006-07, the total FDI equity inflow at US$15.7 billion was 2.8 times more than the inflow of US$5.5 billion, received during the previous fiscal. This is the highest FDI equity inflow into the country during any financial year.

The top five sectors which attracted highest FDI during 2006-07 were Services, Electrical Equipments (including computer software & electronics), Construction Activities, Telecommunications and Real Estate. The bulk of the flow was in the Services sector. The sector increased its share in total FDI from 10.5 per cent in 2005-06 to 38 per cent in 2006-07. The Construction and Real Estate sectors together also increased their share to 10 per cent from just 3.4 per cent in 2005-06. Telecommunication was the biggest looser. Its share dwindled from 12.2 per cent in 2005-06 to 4 per cent in 2006-07.

Destination-wise analysis of the inflows indicated, that nearly half of the total inflows (US$ 6.3 billion) came from Mauritius. The other top sources were U.K., U.S.A., Netherlands & Singapore. The top five countries together contributed 83 per cent of the total FDI equity inflows during 2006-07 as compared to 67 per cent in 2005-06.

Reiterating the UPA government policy, the Finance Minister - Mr. P Chidambaram on 08 May 2007 stated in the Rajya Sabha, that government has no intention to allow FDI in retail business. Currently, FDI is being allowed only for cash-and-carry, whole-sale and single-brand retail.

The government on 11 May 2007 constituted two committees to oversee implementation of FDI in telecom sector by the companies, especially the guidelines concerning security aspects.

The Union Cabinet, recently approved enhancement of the FDI cap from 49 per cent to 74 per cent and has granted three-month time to companies to comply with the revised guidelines.

The revised FDI norms that are expected to impact several sectors like Telecom, Real Estate, Banking and Retail are likely to be announced by July 2007. The process of consultation between the various ministries on foreign investments is in progress and is expected to be completed soon.