RESILIENCE AND REALIGNMENT OF FOREIGN DIRECT INVESTMENT IN INDIA: COUNTRY-WISE AND SECTORAL ANALYSIS (2020–2025)

DOI: https://doie.org/10.65985/APER.2025846471

Authors:

Ann Jose

Keywords:

This study examines foreign direct investment (FDI) flows into India between 2020 and 2025 using secondary data from the Reserve Bank of India (RBI), the Department for Promotion of Industry and Internal Trade (DPIIT), the Organisation for Economic C

Abstract:

This study examines foreign direct investment (FDI) flows into India between 2020 and 2025 using secondary data from the Reserve Bank of India (RBI), the Department for Promotion of Industry and Internal Trade (DPIIT), the Organisation for Economic Co-operation and Development (OECD), and the United Nations Conference on Trade and Development (UNCTAD). The results show sharp fluctuations, with inflows rising to 59.6 billion United States dollars (USD) in 2020 21, dipping to 44.4 billion USD in 2023–24, and then recovering modestly in 2024–25. Singapore remained the largest contributor, while investments from the United States of America (USA) weakened due to trade frictions and reshoring strategies. Sectoral patterns reveal a decline in computer services alongside steady growth in manufacturing and financial services, reflecting the impact of policies such as the Make in India programme and the Production-Linked Incentive (PLI) scheme. These insights fulfil the study’s objectives by offering policy implications for strengthening regulatory stability, diversifying foreign direct investment partners, and supporting sustainable industrial growth. Future research may focus on declining USA inflows and the opportunities created by India’s evolving relations with China and other Asian economies. The analysis applies descriptive methods, trend-based evaluations, country-wise comparisons, and sectoral assessments, highlighting both the cyclical vulnerabilities and the long-term structural strengths of India’s foreign direct investment landscape

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