What is the story about?
India received its highest-ever foreign direct investment (FDI) inflows for the first half of a financial year, with gross inflows touching $50.36 billion in H1FY26, Minister of State for Finance Pankaj Chaudhary told the Lok Sabha on Monday, December 8.
The FDI inflow for the first half of FY26 increased by 16% from $43.37 billion logged in the same period last year.
Chaudhary said FDI continues to act as "a major source of non-debt financial resource for economic growth," supported by an “investor-friendly” policy regime. Over 90% of FDI comes through the automatic route, he noted, adding that India has steadily eased sectoral caps, reduced regulatory frictions and opened more sectors to foreign investment, while "developing infrastructure and improving business environment."
Gross inflows have more than doubled over the past decade from $36.05 billion in FY14 to $80.62 billion in FY25, the government said.
However, the Centre remained silent on the gap between gross FDI inflows cited in Parliament and net FDI reported by the Reserve Bank of India. According to RBI’s balance of payments data, net FDI stood at just $7.64 billion in H1FY26, while net FPI registered a negative $0.4 billion in the same period.
ALSO READ | India at a pivotal moment for FDI and liquidity flows: Citigroup’s Vis Raghavan
The divergence between headline gross inflows and actual net foreign investment remains a key point of debate among economists and markets, especially at a time when portfolio flows have turned volatile.
The FDI inflow for the first half of FY26 increased by 16% from $43.37 billion logged in the same period last year.
Chaudhary said FDI continues to act as "a major source of non-debt financial resource for economic growth," supported by an “investor-friendly” policy regime. Over 90% of FDI comes through the automatic route, he noted, adding that India has steadily eased sectoral caps, reduced regulatory frictions and opened more sectors to foreign investment, while "developing infrastructure and improving business environment."
Gross inflows have more than doubled over the past decade from $36.05 billion in FY14 to $80.62 billion in FY25, the government said.
However, the Centre remained silent on the gap between gross FDI inflows cited in Parliament and net FDI reported by the Reserve Bank of India. According to RBI’s balance of payments data, net FDI stood at just $7.64 billion in H1FY26, while net FPI registered a negative $0.4 billion in the same period.
ALSO READ | India at a pivotal moment for FDI and liquidity flows: Citigroup’s Vis Raghavan
The divergence between headline gross inflows and actual net foreign investment remains a key point of debate among economists and markets, especially at a time when portfolio flows have turned volatile.
