Reserve Bank of India (RBI) has released provisional results of the 2024–25 Foreign Liabilities and Assets (FLA) Census of Indian direct investment entities. The report revealed that the United States and Singapore together contributed over one-third of India’s total Foreign Direct Investment (FDI), reaffirming their positions as India’s top investment partners.
This highlights India’s strong global investment ties and a steady increase in foreign investor confidence amid global economic uncertainties.
RBI’s FLA Census 2024–25: Highlights
Coverage
- Total participants: 45,702 Indian companies.
- Companies reporting FDI/ODI: 41,517.
- New participants: 7,880 companies joined this year.
- Returning participants: 33,637 from the previous census.
Foreign Direct Investment (FDI) Trends
- Total FDI stock (FY25): ₹68.75 lakh crore.
- Previous year (FY24): ₹61.88 lakh crore.
- Annual growth: 11.1% — showing consistent foreign investor confidence.
- Foreign-dominated firms: Over 75% of FDI-receiving companies were subsidiaries of foreign entities (foreign shareholding >50%).
Top FDI Source Countries
| Country | Share of India’s FDI (2024–25) |
| United States | 20% |
| Singapore | 14.3% |
| Mauritius | 13.3% |
| United Kingdom | 11.2% |
| Netherlands | 9% |
Together, the US and Singapore accounted for over one-third (34.3%) of total FDI inflows into India.
Sectoral Distribution of FDI
Manufacturing Sector:
- Received the highest share– 48.4% (market value), and 37.8% (face value).
- Reflects India’s rise as a global manufacturing hub, aided by “Make in India” and PLI schemes.
Services Sector:
- Ranked second, led by IT, digital services, financial, and business services.
- Showcases India’s growing role in technology-led global services.
- Non-financial companies held over 90% of total FDI equity — indicating the dominance of industrial and core sectors.
Outward Direct Investment (ODI): India’s Global Expansion
- Total ODI stock (FY25): ₹11.66 lakh crore.
- Growth: 17.9% YoY, faster than FDI inflows.
- Key Destinations for Indian Investment:
- Singapore – 22.2%
- United States – 15.4%
- United Kingdom – 12.8%
- Netherlands – 9.6%
- Inward-to-Outward Investment Ratio: Declined from 6.3 (FY24) to 5.9 (FY25) — showing increasing global footprint of Indian companies.
Structural Observations
- Unlisted companies: Represented 97% of reporting entities, yet held a significant portion of total FDI equity capital.
- Non-financial sectors: Held 90.5% of total FDI equity, reflecting India’s industrial base expansion.
- Manufacturing-led inflows align with India’s target to become a $5 trillion economy by boosting exports and local production.
Significance of Findings
- Reinforces India’s status as a preferred FDI destination in Asia.
- Demonstrates diversified investment sources beyond traditional tax havens.
- Reflects growing trust in India’s economic reforms, political stability, and digital infrastructure.
- The rise in ODI indicates Indian firms’ global competitiveness and outward growth momentum.
Reserve Bank of India (RBI)
- Established: 1935 (under the RBI Act, 1934).
- Headquarters: Mumbai.
- Current Governor (2025): Sanjay Malhotra
- Key Function: Regulates foreign exchange under FEMA, 1999 and monitors FDI/ODI through FLA Census and Foreign Investment Inflows data.
FLA Census (Foreign Liabilities and Assets Census)
- Conducted annually by the RBI since 1997.
- Covers Indian companies with FDI (inward) or ODI (outward) investments.
- Tracks ownership structure, foreign shareholding, cross-border liabilities, and asset positions.
Foreign Direct Investment (FDI)
- Definition: Investment made by a foreign entity in India to acquire lasting interest and control (≥10% equity).
- Governing Laws:
- FEMA, 1999
- Consolidated FDI Policy (DPIIT)
- Automatic route sectors: Manufacturing, Services, E-commerce, etc.
- Approval route sectors: Defence, Media, and Insurance (above threshold limits).
Outward Direct Investment (ODI)
- Meaning: Investment by an Indian company abroad- through acquisition, joint ventures, or subsidiaries.
- Regulated by: RBI under Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004.
- Shows India’s economic maturity and corporate globalization.
Singapore– India’s Major Investment Partner
- India and Singapore have a Comprehensive Economic Cooperation Agreement (CECA) signed in 2005.
- Singapore serves as a gateway for global capital into India due to low tax and strong financial infrastructure.
United States- Strategic Investment Partner
- Major investor in technology, manufacturing, renewable energy, and services.
- Hosts a large Indian diaspora, contributing to bilateral trade and investment.
- India–US trade ties are a key pillar of the Indo-Pacific Economic Framework (IPEF).