FDI flows plunged due to hardening interest rates and geo-political situation: DPIIT Secy
New Delhi, May 31 (KNN) Secretary of the Department for Promotion of Industry and Internal Trade (DPIIT) Rajesh Kumar Singh told PTI on Tuesday that hardening interest rates globally and worsening geo-political situation have impacted the foreign direct investment (FDI) inflows into India in 2022-23.
He said that the department would analyse the reasons for the contraction in FDI in five important sectors like computer hardware and software; construction, education, automobiles and metallurgical industries.
In an interview with PTI, Singh said, “I cannot think of any other reason. It is not as if our FDI policies have become protectionist. On the contrary, we have kept it very very liberal.”
“The decline is combination of hardening of interest rates along with geo-political risks going up around the world. In general the appetite may be less,” added Singh.
These five sectors had a share of USD 30 billion in India's total FDI in 2021-22 and in the last fiscal year, overseas inflows have almost halved.
He said the reasons why FDI in those sectors have come down needs to be analysed.
FDI equity inflows into India declined by 22 per cent to USD 46 billion in 2022-23.
The investments during the January-March 2023 quarter dropped by 40.55 per cent to USD 9.28 billion. (KNN Bureau)