In a bid to boost its economy and attract investors seeking alternatives to China, India has set an ambitious target of attracting at least US$100 billion in gross foreign direct investment (FDI) annually, according to a top official from the Department for Promotion of Industry and Internal Trade.
Rajesh Kumar Singh, secretary in the department, stated in an interview in New Delhi that India aims to average at least US$100 billion in FDI over the next five years. This target represents a significant increase from the annual average of over US$70 billion recorded in the five years through March 2023.
The move comes as India positions itself as an attractive destination for businesses looking to diversify their operations amid geopolitical tensions, adopting what is commonly referred to as a “China plus one” strategy. Major multinational corporations like Apple Inc. and Samsung Electronics Co. have already expanded their manufacturing presence in India, capitalising on incentives provided by Prime Minister Narendra Modi’s government.
Despite the growth in local manufacturing, foreign investment has not matched the pace. Singh attributed this to various factors, including higher inflation and interest rates in developed nations, as well as geopolitical conflicts and perceived risks associated with emerging markets.
Singh highlighted the untapped market growth opportunities in sectors such as electric vehicles, electronics, and consumer goods, where penetration levels in India’s population remain below the global average. He assured that the government will take additional steps to ease FDI regulations to further attract investment.
India’s push to attract US$100 billion annually in FDI signals its determination to bolster economic growth and emerge as a competitive investment destination on the global stage.
