India’s remarkable growth as a preferred global investment destination over the last decade is a story of vision, bold reforms, and unwavering leadership. From a foreign direct investment (FDI) rank of 15 in 2013 to 8th in 2022, according to UNCTAD, India has come a long way in its FDI journey. India achieved a remarkable milestone in its economic journey, with cumulative gross FDI inflows reaching an impressive $1 trillion since April 2000 to December 2024. It is evident that FDI has played a major role in the growth of our $4 trillion economy. With the proactive and stable policies of the Government of India, complemented by States’ policies and outreach over the years, the country has not only emerged as one of the world’s fastest-growing economies but has also become a magnet for FDI across diverse sectors. Despite global economic headwinds, geopolitical uncertainties, and evolving supply chain dynamics, India has demonstrated remarkable resilience, consistently standing out as a stable, predictable, and high-potential destination for global investors.
FDI has converged with the various programmes of the Government, particularly its mission to create jobs. And the finest example of this is Government’s Make-in-India initiative which is also a high priority area for FICCI. It’s well accepted that for India’s growing labour force to be absorbed, its manufacturing sector has to grow steadily for years. The Make-in-India initiative provided the necessary impetus for the sector and our FDI inflows have also aligned well with this approach. If we look at Gross inward FDI which grew by 15.2 per cent (y-o-y) to US$ 75.1 billion during 2024-25 (April-February), manufacturing sector accounted for the highest share (24.1 per cent) of FDI inflows, followed by financials services and electricity. It is the outcome of sustained, reform-driven policymaking and a commitment to creating a business environment that is transparent, facilitative, and forward-looking. The liberalisation of FDI norms across sectors such as insurance, defense, telecom, and retail has opened up new avenues for global capital. Simultaneously, landmark schemes like the Production Linked Incentive (PLI) programme, India Semiconductor Mission, and the likes have catalysed FDI in manufacturing sector, transforming India into a trusted global hub for high-tech and value-added production. Further, Prime Minister’s focus on ‘Zero Defect-Zero Effect’ is catalysing industry’s transition to a more sustainable and high-quality ecosystem in the country which has drawn interest from global investors too. At the core of this transformation lies the Government’s emphasis on “Ease of Doing Business.” The implementation of Goods and Services Tax (GST), digitization of regulatory approvals, simplification of corporate and labour compliances, and repeal of redundant laws have significantly reduced friction for businesses. These measures have improved India’s competitiveness and enabled both large enterprises and emerging startups to scale with confidence. A standout feature of India’s FDI journey is the exemplary coordination between the Centre and the States. While the Central Government has provided the overarching policy vision, States have responded with agility and determination, translating that vision into tangible on-ground outcomes. From proactive investment promotion to infrastructure readiness and handholding of investors, many States have emerged as key enablers in India’s growth story. The Gujarat semiconductor cluster is one such example where seamless coordination between the Central and State Governments ensured timely land allocation, infrastructure alignment, and investor facilitation for a capital-intensive, globally significant industry. Similarly, Tamil Nadu and Karnataka have played a pivotal role in establishing India as a manufacturing base for global electronics brands. One of the most compelling illustrations of India’s FDI success is in the mobile manufacturing sector. Enabled by visionary policies like the mobile manufacturing PLI scheme, and backed by progressive state-level governance, Apple’s contract manufacturers—Foxconn and Pegatron —have significantly expanded operations. In FY 2024–25, iPhone exports from India worth $17.4 billion (approx. Rs 1.5 trillion). This not only showcases India’s manufacturing prowess but also underlines how effectively Centre–State synergy can deliver outcomes at global scale and standards. Such large investments have been supporting development of MSME vendor base in the country, be it automotive earlier or electronics now, opportunities galore for our MSMEs with the FDI. In the renewable energy space too, India has emerged as a beacon of opportunity. The Government’s commitment to achieving 500 GW of non-fossil energy capacity by 2030 has created a conducive policy and investment ecosystem. Global players have made significant investments in solar, wind, and hybrid energy projects. States like Rajasthan, Gujarat, and Tamil Nadu have played a critical role in enabling the rollout of these projects by ensuring land availability, grid connectivity, and local facilitation. The focus on renewables has not only helped us to cut pollution but is also steadily bringing down our oil imports share in our total imports. Today, oil imports are around 25-26% of our total goods imports, as compared to average of over 30% a decade back. The rise in FDI is also deeply aligned with India’s growing stature on the global geopolitical stage. As economies diversify their supply chains, India has emerged as a reliable partner. The signing of landmark Free Trade Agreements with the UAE and Australia, the conclusion of the India–UK FTA, and continued progress in negotiations with the EU further enhances India’s integration into global trade and investment networks. Importantly, the Government’s Viksit Bharat 2047 vision and strategic initiatives like the India-Middle East-Europe Economic Corridor (IMEC), Industrial Corridors, reflect a long-term, aspirational roadmap that inspires confidence among global investors. These initiatives signal that India is not just investing for today’s growth but is preparing for tomorrow’s leadership in global value chains, digital infrastructure, green energy, and advanced manufacturing. India’s decade of FDI success is not just a testament to policy reform—it is a reflection of purposeful governance, clear economic vision, and unwavering execution. It is about building trust—trust in India’s institutions, in its talent, in its ability to deliver, and in its future. As we step into the next phase of growth, FICCI believes that India is poised to scale even greater heights in attracting strategic investments that create value, jobs, and long-term partnerships. The world today looks at India not just as a market, but as a collaborator, innovator, and solution provider. With the strong and visionary leadership of our Prime Minister, empowered States, and an entrepreneurial private sector, India’s FDI journey is truly a story of collective confidence and shared ambition. -The author, Harsha Vardhan Agarwal, is President, FICCI. The views are personal.
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