India attracts record FDI of $81 bn in FY21; Gujarat remains top recipient

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Foreign direct fairness investments (FDI) inflows grew by 19 per cent year-on-year (YoY) in financial year 2020-21 (FY21) to a record $59.64 billion, according to data released by the Branch for Promotion of Industry and Internal Commerce (DPIIT) on Monday.


Despite the disruption caused by the Covid-19 pandemic in FY21, India attracted the highest ever complete FDI influx, which includes fairness capital of unincorporated bodies, reinvested earnings, and other capital. Complete FDI stood at $81.72 billion, up 10 per cent YoY. In FY20, India attracted gross inflows of $74.39 billion.



“Measures taken by the government on the fronts of FDI policy reforms, investment facilitation and ease of doing commerce have resulted in increased inflows. The trends are an endorsement of India’s status as a preferred investment destination amongst global investors,” an official observation said.


According to the data shared by the government, Singapore remained the largest source of FDI for the third consecutive year, with a share of 29 per cent. It was once followed by the United States with 23 per cent share, and Mauritius with 9 per cent.


“Out of top 10 countries, Saudi Arabia is the top investor in the case of percentage increase all over FY21. It invested $2.8 billion compared to US$ 89.93 million reported in the preceding financial year,” the observation said, adding that there was once a 227 per cent and 44 per cent increase recorded in FDI fairness influx from america and the United Kingdom, respectively.


Gujarat was once the top recipient of FDI among states, with 37 per cent share of complete FDI fairness inflows, followed by Maharashtra and Karnataka with 27 per cent and 13 per cent, respectively.


Gujarat attracted the lion’s share of inbound FDI under the computer software and hardware sector at 78 per cent. This was once followed by Karnataka and Delhi at 9 per cent and 5 per cent, respectively.


“Majority of the fairness influx of Gujarat has been reported in the sectors ‘Computer Software & Hardware’ (94 per cent) and Construction (Infrastructure) Activities (2 per cent) all over the FY21,” the observation said.


Computer software and hardware emerged as the top sector in FY21 with around 44 per cent of the complete FDI fairness influx, followed by construction and infrastructure-related activities at 13 per cent, and services and products sector’s with 8 per cent.

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