New Delhi: India’s foreign direct investment (FDI) equity inflows rose 18% year-on-year to $47.8 billion during April-December FY26, according to data released by the Department for Promotion of Industry and Internal Trade (DPIIT) on Friday, underscoring resilient overseas investor interest amid global volatility. FDI equity inflows stood at $40.67 billion in the corresponding period of FY25.
Total FDI — comprising equity inflows, reinvested earnings and other capital — increased 17.4% to $73.31 billion in the first nine months of the current fiscal, compared with $62.48 billion a year earlier.
In the October-December quarter, FDI equity inflows rose 16.6% on-year to $12.69 billion from $10.88 billion in the year-ago period. However, inflows fell over 23% sequentially from $16.4 billion recorded in July-September FY26, indicating some moderation in quarterly momentum.
Total FDI during the third quarter stood at $21.52 billion, up 13% from $18.98 billion in the same quarter last fiscal. December recorded the strongest monthly equity inflows of the quarter at $5.48 billion.
By source, Singapore remained the largest investor during April-December FY26 with $17.6 billion in equity inflows, followed by the US at $7.8 billion. Inflows from the US nearly doubled from $3.73 billion in the same period last year. Investment flows from Singapore, the US and the UAE increased, while inflows from Mauritius and the Netherlands declined year-on-year.
At the state level, Maharashtra attracted the highest FDI inflows at $15.38 billion during the nine-month period, followed by Karnataka at $11.15 billion and Gujarat at $5 billion.
Sectorally, computer hardware and software drew the largest share of overseas investments at $10.7 billion in April-December FY26, followed by services at $8.4 billion.
India is targeting annual FDI inflows of $100 billion, up from the current $70-80 billion range, as it seeks to deepen manufacturing under the ‘Make in India’ initiative.
FDI occurs when an investor from one economy establishes a lasting interest and significant influence in an enterprise based in another economy. FDI financial flows comprise three components: equity transactions, reinvested earnings, and intercompany debt transactions. Outward flows refer to investments made by residents into foreign enterprises, including equity purchases and reinvested profits, minus disinvestment such as equity sales or borrowing from those foreign entities. Inward flows capture investments made by foreign investors into resident enterprises, net of any reductions in such investments. The indicator is measured in million dollars.
(Cover photo by Allison Saeng on Unsplash)