RBI Data: India’s Net FDI Drops to $1.5 Billion in Apr-Feb Due to Increased Outflows

India witnessed a notable shift in foreign direct investment (FDI) patterns during the period of April 2024 to February 2025. Despite a rise in gross inflows, net FDI declined sharply, influenced by higher repatriation and an increase in outward investments by Indian firms. 

Recent data from the Reserve Bank of India (RBI) highlights the evolving landscape of cross-border investments and the factors shaping these movements.

Rising Gross Inflows Despite Net Decline

Gross FDI into India recorded a healthy year-on-year (Y-o-Y) growth of 15.2%, amounting to $75.1 billion during April 2024- February 2025, compared to $65.2 billion in the same period a year earlier. 

This growth was largely driven by equity inflows from major contributors, with Singapore leading at 29.8%, followed by Mauritius and the United States. Sector-wise, the manufacturing industry attracted the highest share of investments at 24.1%, closely followed by financial services and electricity.

Despite the rise in gross inflows, net FDI declined steeply to $1.5 billion from $11.5 billion recorded in the corresponding period of the previous year. This sharp fall was primarily due to increased repatriation and a surge in overseas investments by Indian corporations.

Surge in Repatriations and Outward Investments

Repatriation or disinvestment by foreign investors in India increased substantially, reaching $48.9 billion during the 11-month period of 2024-25, compared to $40.7 billion in the preceding year. Simultaneously, Indian firms expanded their global footprint with outward FDI surging to $24.8 billion from $13 billion in April 2023- February 2024.

On the global stage, the United States maintained its position as the most preferred destination for inward FDI and emerged as the second-largest destination for outward direct investment (ODI) from India. Recent policy developments have encouraged multinational corporations to redirect investment plans towards the United States, further influencing global investment patterns.

Read More: RBI Data: Net FDI Slips to US$1.4 Billion in Apr-Jan 2025; Gross FDI Surges by 12.4%

Conclusion

The dynamics of India’s foreign direct investment have undergone a significant transformation, marked by elevated gross inflows, increased repatriations, and a substantial rise in outward FDI. The broader global investment environment, coupled with domestic trends, continues to shape India’s FDI landscape.

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