FDI increases by 12.29% to $2.01 billion in February

Foreign direct investment (FDI) in India grew by 12.29 percent to $2.01 billion in the month of February, as compared to $1.79 billion in the same month of previous year. However, during April-February FY14, FDI dipped by modest 0.6 percent to $20.76 billion from $20.89 billion recorded in the corresponding period of FY13. The sectors that received highest inflows during the first eleven months of FY14 include services ($2.18 billion), automobiles ($1.28 billion), pharmaceuticals ($1.27 billion) and construction development ($1.05 million). Country wise, maximum FDI during the reported period was received form Mauritius with $4.48 billion followed by Singapore ($3.91 billion), UK ($3.21 billion) and Netherlands ($2.20 billion). FDI is considered crucial for economic development of a country and to attract maximum FDI into the country, the government has been liberalizing the foreign investment policy. The government has relaxed FDI norms in around 12 sectors which include telecom, tea, pension and petroleum and natural gas among others. Now, it has started exercise for allowing FDI in railways and defence sectors. Despite the government various efforts to increase FDI, foreign investment during April-February FY14 has declined, which reflects the need to take more measures to improve the business environment in the country. Furthermore, India would require around $1 trillion in the 12th five year plan (2012-2017), to overhaul its infrastructure sector such as ports, airports and highways to boost growth.