Services corner bulk of FDI inflows

According to an analysis of the official data by the Department of Industrial Policy and Promotion and Citi Research,more than half of total FDI inflows in 2015 came into the services sector, comprising software, financial services, trading, hospital and tourism.

Key facts:

• Although India received an all-time high annual foreign direct investment (FDI) in 2015, the surge is led by the inflows into the services sector.
• In 2014, the services sector accounted for about a third of the gross inflows. FDI into the sector in 2015 was 111% higher than in 2014.
• The inflows into the manufacturing sector are up 6% in 2015 after the 19% fall in 2014. FDI into infrastructure in 2015 was marginally lower than in 2014.
• Inflows to construction surged 188% from $1527 million to $4,405 million. Insurance received $581 million against $236 million, a 146% jump.
• FDI in Railways declined 67% to $71 million from $213 million in the previous year. Air transport too saw lower inflows — $50 million against $73 million. For mining the fall was from $666 million to $547 million. The defence sector is yet to receive FDI.
• In the 20 months of the NDA government, India has received total FDI of $85 billon compared to $59 billion in a similar period before that. FDI outflows (Indians investing overseas) declined 37%, confirming the change in investor sentiment.