Foreign direct investment (FDI) equity inflows in the July-September quarter of FY24 shrank 7.7% to $9.5 billion, data released by Department for Promotion of Industry and Internal Trade (DPIIT) showed.
The inflows were $10.3 billion a year ago.
The total FDI, which includes equity inflows, reinvested earnings and other capita, into India declined 7.8% on-year to $15.3 billion during second quarter of this fiscal year from $16.6 billion a year ago.
As per the data, the equity inflows fell 24% on-year in the first half of FY24 at $20.4 billion with Singapore being the top source followed by Mauritius.
Sequentially, the inflows contracted 12.8% from the quarter ended June 30, 2023.
Investments from overseas fell in April, May, June, July and August but rose in September, to $4.08 billion from $ 2.97 billion in the same month last year.
Tax havens such as the Cayman Islands and Cyprus were among the top 10 sources of overseas investments for India. However, the FDI inflows from Mauritius, Cyprus, the US, and the Cayman Islands, shrank in the first half of 2023-24, the data showed.
Among sectors, the services sector attracted the highest inflows of $3.8 billion in the first half followed by construction (infrastructure) activities, and the computer software and hardware sectors at $2.4 billion each.
Maharashtra received the highest inflow of $7.9 billion in April-September 2023-24, from $8 billion a year ago followed by Karnataka where the inflows fell to $2.8 billion from $5.3 billion. FDI dipped in Gujarat, Rajasthan, Delhi, Tamil Nadu, and Haryana also.
India and Asean were the most buoyant recipients of foreign direct investment with a growth of 10% and 5% respectively in 2022, according to the United Nations Conference on Trade and Development.
Globally, FDI declined 12% to $1.3 trillion in 2022 after a strong rebound in 2021 following the steep drop due to the Covid-19 pandemic.