FDI inflows set to top $90 billion in FY26, says DPIIT Secretary Bhatia

India's gross foreign direct investment (FDI) inflows for the financial year 2025–26 are projected to exceed $90 billion, as confirmed by senior DPIIT offici...

What Happened

India's gross foreign direct investment (FDI) inflows for the financial year 2025–26 are projected to exceed $90 billion, as confirmed by senior DPIIT officials, based on April–February data already touching $88.29 billion.
This represents an 18.1 per cent year-on-year increase compared to the corresponding period in FY25, and would mark the highest gross FDI figure India has recorded.
The momentum is attributed to a combination of ongoing structural reforms, progress on multiple free trade agreements (FTAs), India's positioning as a global manufacturing alternative, and strong macroeconomic fundamentals including sustained GDP growth.
Net FDI — which subtracts repatriation and outward investment from gross inflows — has also recovered sharply, rising by $6.26 billion compared to only $959 million the previous year, indicating that capital is remaining in India rather than being repatriated.
Key source countries for FDI remain Singapore, the United States, Mauritius, Japan, and the Netherlands; manufacturing, computer services, financial services, and communication services together account for over two-thirds of equity inflows.
The FDI trajectory is being supported by specific regulatory reforms including the Press Note 3 amendment for Chinese-stake companies, sector-specific liberalisation, and the introduction of processing timelines for government-approval proposals.

Static Topic Bridges

Gross FDI vs. Net FDI — Why the Distinction Matters

Gross FDI refers to the total inflow of foreign direct investment into a country during a given period, without accounting for outflows. Net FDI subtracts repatriation of dividends and profits, divestments, and outward FDI by Indian entities from the gross figure. While gross FDI captures the scale of investor interest and capital deployment, net FDI reflects the actual addition to the country's productive capital base. A high gross figure alongside low net FDI can indicate significant profit repatriation or divestment pressure — a concern India has faced in recent years.

India's gross FDI for April–February FY26: $88.29 billion (projected full year: $90+ billion).
Net FDI for the same period rose by $6.26 billion, compared to just $959 million in the prior year — a significant turnaround.
The gap between gross and net FDI is relevant for balance of payments analysis and for assessing the real contribution of foreign capital to domestic investment.
India's cumulative FDI inflow (April 2000–December 2025) stands at $1.14 trillion, making it one of the largest recipients of FDI among emerging market economies.

Connection to this news: The simultaneous improvement in both gross and net FDI figures signals strengthening investor confidence and reduced repatriation pressure — a more positive structural picture than gross FDI alone would suggest.

DPIIT — Role in FDI Policy and Investment Promotion

The Department for Promotion of Industry and Internal Trade (DPIIT), under the Ministry of Commerce and Industry, is India's nodal agency for FDI policy formulation and investment facilitation. DPIIT issues the Consolidated FDI Policy and Press Notes, administers the Foreign Investment Facilitation Portal (FIFP) for government-approval route proposals, and publishes periodic FDI statistics. It works in coordination with the Department of Economic Affairs (DEA), which translates DPIIT's policy decisions into legal notifications under the Foreign Exchange Management Act (FEMA).

DPIIT was renamed from the Department of Industrial Policy & Promotion (DIPP) in January 2019 when internal trade was added to its mandate.
It is the nodal body for flagship investment schemes including Make in India, Startup India, and the Production Linked Incentive (PLI) scheme.
DPIIT publishes monthly and annual FDI Factsheets, which are primary data sources for FDI statistics cited in parliamentary debates, policy documents, and UPSC questions.
FDI data is compiled from RBI reporting (Form FC-GPR filings) and consolidated by DPIIT.

Connection to this news: The $90 billion projection is a DPIIT assessment, reflecting the department's role as the primary custodian of FDI data and investment promotion. DPIIT's bullish projection also signals the government's intent to use FDI performance as a metric for policy credibility.

India's FDI Policy Landscape — Reforms and FTA Linkages

India has progressively liberalised its FDI regime over the past decade, expanding the automatic route to cover most sectors and raising sectoral caps. Complementing this, the pursuit of bilateral and regional free trade agreements (FTAs) has opened new pathways for investment alongside trade. In FY26, notable FDI-supportive developments include the Press Note 3 amendment (easing restrictions on Chinese-minority-stake foreign companies), the signing of the India–New Zealand FTA (April 2026), and ongoing negotiations with the European Union and the United Kingdom.

India has signed FTAs with approximately 13 countries/blocs including UAE, Australia, and Mauritius (CECPA), and is negotiating with the EU, UK, and Canada.
Production Linked Incentive (PLI) schemes across 14 sectors are specifically designed to attract FDI into manufacturing.
India attracted $1 trillion in cumulative FDI by 2022 and crossed $1.14 trillion by December 2025.
The Chief Economic Adviser has noted that $90 billion in FDI for FY26 would represent approximately 2% of India's GDP.

Connection to this news: The $90 billion milestone reflects the compounding effect of structural reform, trade agreement progress, and geopolitical repositioning — demonstrating how investment policy, trade policy, and macroeconomic management interconnect in India's development strategy.

Key Facts & Data

Gross FDI inflow April–February FY26: $88.29 billion
Year-on-year growth: 18.1%
Projected full-year FY26 gross FDI: above $90 billion
Net FDI increase (April–February FY26): $6.26 billion (vs. $959 million in prior year)
Top FDI source countries: Singapore, USA, Mauritius, Japan, Netherlands
Top recipient sectors: manufacturing, computer services, financial services, communication services
Cumulative FDI into India (April 2000–December 2025): $1.14 trillion
Nodal ministry for FDI data: DPIIT, Ministry of Commerce and Industry
$90 billion FDI ≈ approximately 2% of India's GDP for FY26