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India will attract more foreign investment

Friday, January 8, 2021

Significance

FDI reached USD40bn in April-September 2020, a 13% rise compared with the corresponding period in 2019. FPI totalled nearly USD23bn in 2020, up 58% from 2019.

Impacts

  • Privatisation of several state-owned enterprises will help attract more foreign capital in the long term.
  • The trade deficit will decrease as the government increasingly promotes self-reliance and moves to reduce Chinese imports.
  • India-China business relations will worsen as border tensions between the strategic rivals endure.
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