The foreign investment has continued its declining trend with 4MFY22 netFDI standing 12 percent year-on-year lower led by a 23.7 percent rise inoutflows and 3 percent year-on-year decline in inflows.
Country wise data from the central bank shows that FDI from China hascontinued to decline – falling by 71 percent year-on-year in 4MFY22. Itsshare in total FDI too came down from over 50 percent in 4MFY21 to lessthan 18 percent in 4MFY22.
With net FDI from China dipping consistently, and FDI from other countriesalso remaining weak and debilitating amid the country’s inherentchallenges, FDI is in a much more precarious situation today. Where China’sshare in total FDI has slipped, net inflows from the US have jumped up from3 percent to 17 percent year-on-year in 4MFY22.
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However, the small sum dulls the excitement over the recent year-on-yearincrease. Sector wise, the power sector shows the largest year-on-yeardecline; yet remains the sector with the largest net FDI for 4MFY22,showing how FDI in other sectors is minimal.
