Mumbai, May 31 (KNN) Foreign direct investment (FDI) inflows into India's manufacturing sector continued its downward trajectory in the fiscal year 2023-24, according to provisional data released by the Reserve Bank of India (RBI).

The RBI's annual report shows that manufacturing received only USD 9.3 billion in FDI in FY24, marking a steep 17.7 per cent decline from the USD 11.3 billion received in the preceding fiscal year FY23.

The latest FDI number is a far cry from the USD 16.3 billion that poured into the manufacturing sector in FY22 - the highest level of investment into the industry in recent years.

The dwindling manufacturing FDI comes despite the government's concerted efforts through schemes like Make in India and production-linked incentives to attract more foreign capital into the sector and boost domestic production capabilities.

Industry bodies have expressed concerns over the consistent decline in FDI inflows targeting manufacturing after the peak of FY22.

They have called for further reforms and policy measures to enhance India's attractiveness for global manufacturers looking to set up or expand operations in the country.

For a sector that is vital for employment generation and overall economic growth, shoring up manufacturing FDI will be crucial as India pursues its ambition of becoming a USD 5 trillion economy over the next few years.

The manufacturing sector's poor FDI performance also reflects the overall slowdown, with total FDI into India across sectors decreasing to USD 44.4 billion in FY24 from USD 46 billion in FY23.

(KNN Bureau)