India’s Outward Foreign Direct Investment Surges in FY2024-25
India’s outward foreign direct investments (FDI) witnessed a sharp increase in the first ten months of FY2024-25, surpassing the total recorded in the entire previous fiscal year. Between April 2024 and January 2025, Indian companies and investors sent $20.2 billion abroad—an impressive 71% jump over the $11.8 billion recorded in all of FY2023-24. This surge underlines India’s expanding global investment footprint as domestic firms aggressively explore international opportunities across sectors.
Net FDI Falls Despite Rising Gross Inflows
While outbound investments soared, net FDI into India experienced a steep decline. Net FDI fell to $1.4 billion during April 2024 to January 2025, compared to $11.5 billion during the same period in the previous year. The sharp fall is attributed to increased repatriation and disinvestment by foreign investors, with outflows reaching $46.1 billion—up from $36.9 billion a year earlier.
This decline in net FDI suggests that while new investments are coming in, a larger portion is simultaneously being pulled out, affecting India’s overall FDI balance.
Gross FDI Inflows Maintain Positive Momentum
Despite concerns around net FDI, gross FDI inflows into India remained robust. The data showed a 12.4% increase, with $67.7 billion received from April 2024 to January 2025, compared to $60.2 billion during the same period the previous year. This signals continued international confidence in India’s long-term economic potential, particularly in sectors such as manufacturing, digital infrastructure, and green energy.
Strategic Global Expansion by Indian Firms
The rise in outward FDI reflects Indian businesses actively acquiring global assets, setting up subsidiaries, and pursuing mergers and partnerships abroad. This global push is aimed at securing access to new markets, technology, and resources, helping Indian enterprises enhance competitiveness and scale.
Balancing Capital Inflows and Outflows
While the outward investment trend reflects strategic global integration, the drop in net FDI underlines the need to strengthen India’s domestic investment climate. Policymakers may need to address investor concerns, streamline regulatory frameworks, and ensure policy stability to retain long-term foreign capital.
India’s expanding presence in global markets is a positive sign, but ensuring a stable and growing net FDI position will be crucial for sustaining economic momentum and meeting long-term growth objectives.
