US Remains Largest Source of FDI in India as RBI Census Shows Significant Growth in 2023-24

US Remains Largest Source of FDI in India as RBI Census Shows Significant Growth in 2023-24

The United States continues to be the leading source of foreign direct investment (FDI) in India, followed by Mauritius, Singapore, and the United Kingdom, according to the Reserve Bank of India's (RBI) annual census. The Census on Foreign Liabilities and Assets of Indian Direct Investment Entities for 2023-24 shows that out of 41,653 responding entities, 37,407 reported either foreign direct investment (FDI) or overseas direct investment (ODI) in their balance sheets as of March 2024. This represents a notable increase in FDI inflows.

Of these, 29,926 companies participated in the previous census, while 7,481 entities were new participants in the current round. Over 75% of the companies reporting inward investment were foreign subsidiaries, highlighting India's role as a hub for global corporate activities.

Non-financial companies contributed nearly 90% of the total FDI equity at face value. FDI inflows surged by 23.3% in rupee terms during 2023-24, supported by both valuation gains and fresh investments. In contrast, ODI growth was relatively modest at 3.4%. Unlisted entities saw FDI grow by 17.5%, while listed entities experienced even higher growth at 29.8%. Consequently, the ratio of outward to inward direct investment stock fell to 16.1% in March 2024, compared to 19.3% the previous year.

Foreign subsidiaries in India maintained robust external trade linkages, with exports and imports accounting for 35.4% and 31.5% of their sales and purchases, respectively. Their total sales increased by 13.2%, while purchases rose by 10.6% in rupee terms during the fiscal year.