Foreign Direct Investment in India

Though India has a long history of foreign direct investment (FDI) inflows, the actual FDI postindependence was quite low. Post-1991 liberalization policies supported inflow of FDI. Overall there is increase in foreign trade from 1991 to 2012 however the annual growth has not been consistent over the years. Services, construction development, telecommunications, computer software and hardware, and drugs and pharmaceutical have received the maximum amount of FDI inflows. These five sectors have received almost half of the overall FDI inflows. Mauritius, Singapore, United Kingdom, Japan and South Africa have contributed the maximum amount of FDI inflows. These five countries have contributed almost three-fourth of the overall FDI inflows. Mumbai, New Delhi, Bangalore, Chennai, Ahmadabad and Hyderabad offices of RBI have contributed the maximum amount of FDI inflows. These six offices have contributed more than two-third of the overall FDI inflows. Maharashtra has received the maximum amount of FDI. However the FDI inflows are quite small in comparison to China.