ADB Chief Economist Highlights FTAs and Lower Import Duties as Key to Boosting FDI in India
The Asian Development Bank's Chief Economist, Albert Park, has emphasized the importance of Free Trade Agreements (FTAs), reduced import tariffs, and an improved business environment in boosting net foreign direct investment (FDI) flows into India. According to Park, these measures are crucial as India has seen a decline in net FDI from USD 38.6 billion in 2021-22 to USD 10.2 billion in FY24. The net FDI further dropped to USD 1 billion in FY25 but showed signs of recovery to USD 3 billion during the April-December period of FY26. Park suggests that the Indian government should continue to lower import tariffs and enhance the manufacturing ecosystem by developing industrial zones with robust infrastructure. These steps are expected to make India more attractive to foreign investors. Additionally, Park noted that the Asian market is currently vulnerable to Middle East shocks, which could impact capital flows. 
