These figures serve as an eye-opener for the opposition, which frequently criticizes the government regarding foreign investment!
Dr. Mayank Chaturvedi
For years, various political allegations have been leveled against India's economy. Claims have ranged from assertions that foreign investors are shying away from India to allegations that the government's economic policies are eroding the confidence of global companies. However, fresh data presented in Parliament has refuted all such opposition claims. India set a new record for gross Foreign Direct Investment (FDI) of $94.84 billion in the 2025-26 fiscal year. This stands as proof that major global investors view India as a trustworthy nation with immense potential.
In fact, data presented in the Rajya Sabha by Minister of State for Finance Pankaj Chaudhary reveals that while gross FDI stood at $80.61 billion in the 2024-25 fiscal year, it rose to $94.84 billion the following year. Even more significant is the fact that net FDI surged from $0.96 billion to $6.95 billion. This indicates that the actual confidence of foreign investors is steadily strengthening.
The government also clarified that the earlier observed decline in net FDI was primarily due to investors repatriating capital after realizing profits and Indian companies rapidly investing abroad. In other words, the outflow of capital from India is not a sign of economic weakness but rather an indicator of the global expansion of Indian industries.
Investment Encouraged Under the Modi Government
Since 2014, India has undertaken comprehensive economic reforms to attract foreign investment. FDI norms have been liberalized across numerous sectors, ranging from defense and railways to insurance, civil aviation, coal, space, telecommunications, e-commerce, single-brand retail, digital services and manufacturing. Furthermore, numerous initiatives by the Modi government, such as Make in India, Digital India, Startup India, the Production-Linked Incentive (PLI) scheme, the National Infrastructure Pipeline, GST, the Insolvency and Bankruptcy Code (IBC) and improvements in the ease of doing business, have made India increasingly attractive to investors.
It is worth noting that during the tenure of the BJP-led central government, India consistently attracted FDI ranging between $70 billion and $85 billion annually and has now set a new record of approximately $95 billion for the 2025-26 period. Indeed, this demonstrates that despite global economic uncertainties, India remains the top choice for investors.
Which countries have placed the greatest confidence in India?
Singapore has consistently been the largest source of FDI into India during the Modi government's tenure. It is followed by Mauritius, which has long served as a key conduit for investment into India. Other countries that have made significant investments in India include the USA, the Netherlands, Japan, the United Arab Emirates (UAE), the United Kingdom, Germany, France, South Korea and the Cayman Islands.
In recent years, a significant rise in investment from the UAE has been observed following the Comprehensive Economic Partnership Agreement (CEPA). Japan has invested heavily in industrial corridors, metro rail projects, the automobile sector and high-tech manufacturing, while leading US technology companies view India as a future digital hub.
Not Just Services- Manufacturing Now a Key Attraction
The latest World Investment Report by the United Nations Conference on Trade and Development (UNCTAD) indicates that India has evolved beyond being an investment destination limited to the services sector. Foreign companies are now rapidly investing in sectors such as electronics, semiconductors, data centers, renewable energy, defense production, automobiles, logistics and high-tech manufacturing. This shift has enabled India to jump two spots in the global FDI rankings, rising from 13th to 11th place.
Global Confidence in Greenfield Investments
The largest announced Greenfield project of 2025 was secured by India. US-based Alphabet Inc. announced a data center investment worth approximately $14.5 billion. This project undoubtedly symbolizes global confidence in India's digital future. Similarly, Poland’s Hynfra announced an investment of around $4 billion in Andhra Pradesh. Such investments in green energy, hydrogen and industrial infrastructure are preparing India for the economy of the future.
Indian Companies Emerging as Global Players
Data cited by the Modi government reveals that Indian companies are expanding rapidly abroad following the implementation of liberalized Overseas Direct Investment (ODI) rules in 2022. Major Indian conglomerates and firms, including the Tata Group, Reliance Industries, Adani Group, Infosys, TCS, Wipro, Sun Pharma, and the Mahindra Group, are increasing their investments across numerous countries worldwide. Indeed, this trend demonstrates that India is evolving from a mere recipient of foreign investment into a major economy that also invests globally.
Investors Are Returning Because They Are Profiting
The opposition often interprets the repatriation of capital by foreign investors as a sign of waning confidence in India; however, from an economic perspective, there is a more significant aspect to this. When investors generate substantial returns, it is natural for them to repatriate a portion of their profits. This is the standard trajectory for any successful investment destination; thus, the returns on investment serve as proof that investing in India has been profitable. Had investors not received the expected returns, they would not be announcing new investments, yet, new projects are being announced in India continuously.
India’s Greatest Strengths: Stability and a Vast Market
Foreign investors do not make decisions based solely on tax incentives. They also consider political stability, policy continuity, law and order, digital infrastructure, skilled human resources and the vast consumer market; this is why India is currently outperforming many major economies in attracting investment.
The Data Speaks for Itself!
In a democracy, criticism of government policies is natural, but economic discourse must be grounded in facts. Record FDI figures presented in Parliament, the UN’s World Investment Report, India’s leap in global rankings, its global leadership in greenfield projects and steadily growing foreign confidence clearly indicate that India has emerged as one of the world’s most attractive investment destinations.
Ultimately, the rising FDI in India stands as powerful evidence of growing confidence in the nation's journey towards becoming a developed economy. With leading global economies and multinational corporations investing billions of dollars in India, it must be acknowledged that international investor confidence remains unshaken by political allegations; they place their full trust in the policies of the Modi government, as well as in India’s evolving economic potential and its trajectory of stable growth.
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Hindusthan Samachar / Mayank Chaturvedi
