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India receives highest amount of monthly FDI in March

10 May 2012 Evaluate

India has received the highest amount of monthly foreign direct investment (FDI) of $8.1 billion in the month of March 2012. The highest ever number for the monthly FDI inflows has been that of $5.65 billion received in June last year. The money has come in despite the Vodafone tax dispute which many believed would impact FDI flows into the country.

The addition has taken cumulative FDI inflows for the fiscal 2011-12 to $36.50 billion. The inflows had aggregated to $19.42 billion in 2010-11, however, down from $25.83 billion in 2009-10.

A major contributor to the total inflows has been the deal worth $7.2 billion between Reliance Industries-British Petroleum (BP) which was announced in February 2011. The money from the deal has however come into the country in phases. The UK oil major has picked up a 30% stake in Reliance Industries' 21 oil-fields. The sectors that received substantial amounts of foreign FDI inflows during 2011-12 were services, pharmaceuticals, telecom, construction, power and metallurgical industries with Mauritius being the top FDI source.

The retrospective tax amendment brought in by the government in this year’s Union Budget had received a lot flak with most believing that such changes would adversely affect India’s FDI inflows. The government however has stood its ground and stated that the amendment was not brought in with the view of targeting any particular industry but was done to put the law into perspective. The provision has been approved by the Lok Sabha on May 08, 2012.

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