Sectorwise Analysis of FDI Inflow in India
Abstract:The Sectorwise Analysis of FDI Inflow in India reveals that maximum FDI has taken place in the service sector including the telecommunication, information technology, travel and many others. The service sector is followed by the manufacturing sector in terms of FDI. High volumes of FDI take place in electronics and hardware, automobiles, pharmaceuticals, cement, metallurgical and other manufacturing industries.
Sectorwise Analysis of FDI Inflow in India-GlimpsesThe IT industry is one of the booming sectors in India. At present India is the leading country pertaining to the IT industry in the Asia -Pacific region. With more international companies entering the industry, the Foreign Direct Investments in India has been phenomenon over the year. The rapid development of the telecommunication sector was due to the FDI inflows in form of international players entering the market and transfer of advanced technologies. The telecom industry is one of the fastest growing industries in India. With a growth rate of 45%, Indian telecom industry has the highest growth rate in the world.
Top 10 Sectors Attracting Highest FDI Equity Inflows:
|Ranks||Sector||2009-10 (April-March)||2010-11 ( April- March)||2011-12 (April- Jan.)||Cumulative Inflows (April ‟00 - Jan. ‟12)||% age to total Inflows (In terms of US$)|
|1||SERVICES SECTOR (financial & non-financial)||19,945 (4,176)||15,053 (3,296)||22,771 (4,836)||143,878 (31,971)||20.00%|
|2||TELECOMMUNICATIONS (radio paging, cellular mobile, basic telephone services)||12,270 (2,539)||7,542 (1,665)||8,984 (1,992)||57,050 (12,547)||8.00%|
|3||COMPUTER SOFTWARE & HARDWARE||4,127 (872)||3,551 (780)||3,312 (698)||49,626 (11,107)||7.00%|
|4||HOUSING & REAL ESTATE||14,027 (2,935)||5,600 (1,227)||2,750 (591)||49,025 (10,973)||7.00%|
|5||CONSTRUCTION ACTIVITIES (including roads & highways)||13,469 (2,852)||4,979 (1,103)||10,859 (2,230)||49,440 (10,867)||7.00%|
|6||DRUGS & PHARMACEUTICALS||1,006 (213)||961 (209)||14,482 (3,208)||42,745 (9,170)||6.00%|
|6||POWER||6,138 (1,272)||5,796 (1,272)||7,262 (1,569)||32,798 (7,215)||5.00%|
|7||AUTOMOBILE INDUSTRY||5,893 (1,236)||5,864 (1,299)||2,916 (635)||29,354 (6,470)||4.00%|
|8||METALLURGICAL INDUSTRIES||1,999 (420)||5,023 (1,098)||7,700 (1,655)||26,287 (5,909)||4.00%|
|10||PETROLEUM & NATURAL GAS||1,297 (266)||2,543 (556)||951 (202)||14,612 (3,339)||2.00%|
(i) Cumulative Sector- wise FDI equity inflows (from April 2000 to January 2012) - Annex-'B'.
(ii) FDI Sectoral data has been revalidated in line with that of RBI, which reflects minor changes in the FDI figures (increase/decrease) as compared to the earlier published sectoral data.
Sector-Wise FDI Inflows From April 2000 To January 2012.
|S.No||Sector||Amount of FDI Inflows||%age with total FDI Inflows (+)|
|(In Rs crore)||(In US$ million)|
|3||COMPUTER SOFTWARE & HARDWARE||49626.45||11106.5||6.94|
|4||HOUSING & REAL ESTATE (INCLUDING CINEPLEX,MULTIPLEX, INTEGRATED TOWNSHIPS & COMMERCIAL COMPLEXES ETC.)||49024.58||10972.67||6.86|
|6||DRUGS & PHARMACEUTICALS||42745.26||9170.24||5.73|
|10||PETROLEUM & NATURAL GAS||14611.84||3338.75||2.09|
|11||CHEMICALS (OTHER THAN FERTILIZERS)||14703.35||3244.93||2.03|
|12||HOTEL & TOURISM||14770.58||3229.48||2.02|
|15||INFORMATION & BROADCASTING (INCLUDING PRINT MEDIA)||12062.2||2632.88||1.65|
|16||CEMENT AND GYPSUM PRODUCTS||11324.88||2535.43||1.58|
|17||MISCELLANEOUS MECHANICAL & ENGINEERING INDUSTRIES||9787.16||2180.26||1.36|
|22||FOOD PROCESSING INDUSTRIES||6324.11||1376.99||0.86|
|24||HOSPITAL & DIAGNOSTIC CENTRES||5252.56||1183.04||0.74|
|26||TEXTILES (INCLUDING DYED,PRINTED)||5036.27||1104.54||0.69|
|30||PAPER AND PULP (INCLUDING PAPER PRODUCTS)||3554.22||764||0.48|
|31||PRIME MOVER (OTHER THAN ELECTRICAL GENERATORS)||2801.95||599.13||0.37|
|32||MEDICAL AND SURGICAL APPLIANCES||2421.14||514.08||0.32|
|36||AIR TRANSPORT (INCLUDING AIR FREIGHT)||1924.46||431.2||0.27|
|38||SOAPS, COSMETICS & TOILET PREPARATIONS||1934||411.34||0.26|
|40||VEGETABLE OILS AND VANASPATI||1300.77||276.56||0.17|
|42||PRINTING OF BOOKS (INCLUDING LITHO PRINTING INDUSTRY)||1110.39||244.28||0.15|
|43||RAILWAY RELATED COMPONENTS||1058.18||234.76||0.15|
|44||COMMERCIAL, OFFICE & HOUSEHOLD EQUIPMENTS||1026.7||225.85||0.14|
|48||TEA AND COFFEE (PROCESSING & WAREHOUSING COFFEE & RUBBER)||451.11||100.26||0.06|
|49||PHOTOGRAPHIC RAW FILM AND PAPER||269.26||66.54||0.04|
|51||LEATHER,LEATHER GOODS AND PICKERS||267.9||59.6||0.04|
|52||RETAIL TRADING (SINGLE BRAND)||204.07||44.45||0.03|
|53||BOILERS AND STEAM GENERATING PLANTS||201.86||41.77||0.03|
|59||GLUE AND GELATIN||70.56||14.55||0.01|
|62||MATHEMATICAL,SURVEYING AND DRAWING INSTRUMENTS||5.05||1.27||0|
|64||RBI’S- NRI SCHEMES (2000-2002)||533.06||121.33||-|
The FDI in Automobile Industry has experienced huge growth in the past few years. The increase in the demand for cars and other vehicles is powered by the increase in the levels of disposable income in India. The options have increased with quality products from foreign car manufacturers. The introduction of tailor made finance schemes, easy repayment schemes has also helped the growth of the automobile sector. For the past few years the Indian Pharmaceutical Industry is performing very well. The varied functions such as contract research and manufacturing, clinical research, research and development pertaining to vaccines are the strengths of the Pharma Industry in India. Multinational pharmaceutical corporations outsource these activities and help the growth of the sector. The Indian Pharmaceutical Industry has been experiencing a vast inflow of FDI.
The FDI inflow in the Cement Industry in India has increased with some of the Indian cement giants merging with major cement manufacturers in the world such Holcim, Heidelberg, Italcementi, Lafarge, etc. The FDI in Semiconductor sector in India were crucial for the development of the IT and the ITES sector in India. Electronic hardware is the major component of several industries such as information technology, telecommunication, automobiles, electronic appliances and special medical equipments.
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Last Updated on 4/13/2012