After declining for three consecutive months, foreign direct investment (FDI) in India increased by about 60 percent to $1.76 billion in July.
In July 2011, the country had received foreign investment worth $1.10 billion. However, according to latest data of the Reserve Bank of India (RBI), during April-July 2012 the FDI inflows dipped to $6.18 billion from $14.6 billion in the same period last year.
When asked about the reason for increase in FDI in July, an official in the Commerce and Industry Ministry said these numbers are fluctuating in nature. "But the recent decisions like allowing foreign direct investment in multi-brand retail and civil aviation would help in boosting investments in the country," the official added.
The Centre has also allowed foreign airlines to buy 49 percent stake in the domestic carriers, besides permitting 49 percent FDI in power exchanges.
It has also increased foreign equity cap to 74 percent in services like teleports, DTH, Multi System Operators (MSOs) operating at national, state or district level which were involved in digitisation and mobile TV and mobile TV.
Foreign inflows in April, May and June dipped to $1.85 billion, $1.32 billion and $1.24 billion compared to $3.12 billion, $4.66 billion and $5.65 billion respectively, in the a year-ago period.
Sectors which received large FDI inflows in the month under review include services, pharmaceuticals, construction and power. India received maximum FDI from Mauritius, the Netherlands, the UK, Singapore and Cyprus.
The inflows had aggregated to $36.50 billion in 2011-12 against $19.42 billion in 2010-11 and $25.83 billion in 2009-10.
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