FDI investments around $30 billion expected
Foreign direct investment inflows to India are expected to gain further momentum and net FDI inflows to the country could cross $30 billion mark this fiscal year driven by improved investor sentiment, a Nomura report says.
According to the Japanese brokerage firm, net FDI inflows is on track to top $30 billion and this would reduce India’s external sector vulnerability. Net FDI into India rose sharply to $11.5 billion in the first four months of FY15 (April-July) from $8.4 billion over the same period in FY14, the report said. Nomura said in a research note that based on the current run rate, we estimate that net FDI inflows could rise above $30 billion in FY15 (amounting to 1.4 percent of GDP). Sector-wise, telecom, pharma and financial and business services were the largest recipients over the first three months of this fiscal year.
The large inflow in July could be partly due to fund-raising in the e-commerce sector. The government is taking more steps to boost FDI in the country. It has raised the foreign investment limit to 49 percent in defence manufacturing and relaxed the policy in construction sector. The government has also proposed to increase the FDI cap in insurance to 49 percent.
Source: Financial Chronicle
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