Outward FDI drops 39% to $28.64 billion in FY24

INDIA’S OUTWARD foreign direct investment (OFDI), or overseas direct investment, declined by 39 per cent to $28.64 billion in the year ended March 2024, amid uncertain global economic conditions.

Intheyearendedmarch2023, outwardfdi,whichisrepresented by total financial commitment, stood at $46.96 billion, according to the RBI data. The data released showsoverseasdirectinvestment both under the automatic route and the approval route. Of the total overseas direct investment, commitmentsthroughtheequity route stood at $9.62 billion in fiscal 2024, compared to $19.13 billion in FY2023, the data showed. Theequitycontributedaround34 percentofthetotalfinancialcommitment made in FY2024.

In FY2024, the loan commitments stood at $5.24 billion as

FY2024

Equity

Loans

Guarantee issued

FY2023 (amount in $billion) 9.61

5.24

7.73 against $7.73 billion made in FY2023. “This (outward FDI) all depends on whether opportunities are available for Indian companies or not. With the global economy being in a state of flux, therewouldhavebeenfewersuch (outward FDI) investments being made,” said Madan Sabnavis, Chief Economist, Bank of Baroda.

Experts said the dip in overseas direct investment last year wasbecauseoverseasacquisitions by the Indian companies were 19.13 also not very large.

The overseas guarantees issued by the Indian companies werearound$14billionasagainst $20.09 billion in FY2023. In FY2024, March witnessed the highest outward FDI to the tune of $3.92 billion, with equity commitments of $2.03 billion, also the highest in the year, as per the RBI’S provisional data. In March, loan commitments were $1.05 billion and the guarantee issued stood at $839.17 million.