FDI inflows to India up 20% in 2005: UNCTAD
Inflows of foreign direct investments to India have risen by more than 20 per cent to $6.59 billion in 2005, but this was a fraction of the total global foreign investments of $916 billion, according to a UN report released on Monday.
Total foreign direct investment inflows into the country since 1990 stands at $45.274 billion, while outward flows were at $9.569 billion till 2005, as per the World Investment Report 2006 of the United Nations Centre for Trade and Development.
The report said FDI inflows into India during 2005 stood at $6.598 billion compared to $5.474 billion in 2004. Outward flows by Indian firms declined 32 per cent to $1.364 billion from $2.024 billion in 2004.
India received more than two-third of the total FDI coming to South Asia. The region received $9.765 billion of FDI last year, the report, which was released in India by UNCTAD's country coordinator Veena Jha, noted.
Although FDI inflows into the country has risen, it is still far less than China, which received $72.406 billion in 2005. In fact, China was the largest recipient of FDI among all developing countries worldwide.
At a global level, FDI inflows have increased for the second consecutive year. Investments went up by 29 per cent to $916 billion in 2005, the report said, adding while inflows to developed nations rose by 37 per cent to $542 billion, that to developing countries have increased by just 22 per cent to $334 billion.
According to the UNCTAD report, United Kingdom was the largest recipient of FDI flows in 2005. UK received $164.53 billion of foreign investments, followed by US with $99.44 billion, China $72.406 billion, France $63.57 billion and the Netherlands $43.63 billion.
In terms of outward FDI flows, the Netherlands emerged on top of the list with $119.454 billion dollars of investments made overseas. France comes next with $115.668 billion, followed by UK with $101.099 billion, Japan $45.78 billion, Germany $45.6 billion and Switzerland $42.9 billion of investment outflows.
The report said the growth in FDI inflows was spurred by cross-border mergers and acquisitions, which reflected strategic choices by transnational corporations following increased corporate profits and the recovery of stock markets.
UNCTAD said services sector, particularly finance, telecom and real estate, gained the most from the surge in FDI flows. The share of investments in manufacturing declined, but there was a steep rise in FDI in natural resources, especially oil and gas, the report said.
On the prospects for 2006, the UN body said FDI flows are expected to rise further. This expectation was based on continued economic growth, increased corporate earnings and policy liberalisation.However, factors such as high oil prices, rising interest rates and increased inflationary pressures, which restrain economic growth, may dampen the increase in investments, UNCTAD added.
Total foreign direct investment inflows into the country since 1990 stands at $45.274 billion, while outward flows were at $9.569 billion till 2005, as per the World Investment Report 2006 of the United Nations Centre for Trade and Development.
The report said FDI inflows into India during 2005 stood at $6.598 billion compared to $5.474 billion in 2004. Outward flows by Indian firms declined 32 per cent to $1.364 billion from $2.024 billion in 2004.
India received more than two-third of the total FDI coming to South Asia. The region received $9.765 billion of FDI last year, the report, which was released in India by UNCTAD's country coordinator Veena Jha, noted.
Although FDI inflows into the country has risen, it is still far less than China, which received $72.406 billion in 2005. In fact, China was the largest recipient of FDI among all developing countries worldwide.
At a global level, FDI inflows have increased for the second consecutive year. Investments went up by 29 per cent to $916 billion in 2005, the report said, adding while inflows to developed nations rose by 37 per cent to $542 billion, that to developing countries have increased by just 22 per cent to $334 billion.
According to the UNCTAD report, United Kingdom was the largest recipient of FDI flows in 2005. UK received $164.53 billion of foreign investments, followed by US with $99.44 billion, China $72.406 billion, France $63.57 billion and the Netherlands $43.63 billion.
In terms of outward FDI flows, the Netherlands emerged on top of the list with $119.454 billion dollars of investments made overseas. France comes next with $115.668 billion, followed by UK with $101.099 billion, Japan $45.78 billion, Germany $45.6 billion and Switzerland $42.9 billion of investment outflows.
The report said the growth in FDI inflows was spurred by cross-border mergers and acquisitions, which reflected strategic choices by transnational corporations following increased corporate profits and the recovery of stock markets.
UNCTAD said services sector, particularly finance, telecom and real estate, gained the most from the surge in FDI flows. The share of investments in manufacturing declined, but there was a steep rise in FDI in natural resources, especially oil and gas, the report said.
On the prospects for 2006, the UN body said FDI flows are expected to rise further. This expectation was based on continued economic growth, increased corporate earnings and policy liberalisation.However, factors such as high oil prices, rising interest rates and increased inflationary pressures, which restrain economic growth, may dampen the increase in investments, UNCTAD added.
Source : Rediff
posted by anandsonline @ Tuesday, October 17, 2006
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