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FDI in India rises by 98 percent
By Sriparna
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Wednesday, 28 February 2007, 18:30 IST
New Delhi: Overseas investors seem to be in favor of India. Be it foreign direct investors (FDI), portfolio investors, deposits by the non-resident Indians (NRI) or external commercial borrowing, almost all ingredients of overseas investments have seen a sharp rise in 2006-07.
In the first six months of the current financial year, the central bank made $5.1 billion. The Forex reserves too reached $180 billion by February this year.
The pre-budget economic survey reported that the capital flowing into India remained strong overall even after gross outflows under FDI, with domestic companies seeking a global presence to harness scale, technology and market access through acquisition overseas, reported a national daily.
The survey also reported that from August 1991 to September 2006, India attracted a cumulative FDI inflow of $43.29 billion. According to the latest report of United Nations Conference on Trade and Development, India surpassed South Korea to become the fourth largest recipient of FDI in the region.
Overall foreign investments (including through FIIs and FDI routes) declined to $5.8 billion in the first half of 2006-07 as against $7.5 billion in the corresponding period of the last year. In the first six months, as per provisional data, FDI inflow was at $4.2 billion as against the $4.7 billion in whole of 2005-06.
External Commercial Borrowings (ECBs) continues to play an important role in capital formation. In the first six months of the current fiscal year, net inflows through ECB rose to $5.1 billion as against $2.7 billion in 2005-06. On a gross basis, the inflows rose to $7.1 billion in the first half of 2006-07 from $6.4 billion in the same period of the last year.