India FDI Inflows Jump 44% to $38.89bn in 2025: UNCTAD

India rises to 11th place globally in 2025

India became the world’s 11th-largest destination for foreign direct investment (FDI) in 2025, according to the United Nations’ World Investment Report 2026. The ranking marks a two-position jump from 2024, when India stood at 13th place among recipient countries. The report links the rise to India’s policy framework aimed at modernising manufacturing and broadening investment beyond services. It also comes after India slipped out of the global top 10 in recent years, making 2025 a notable recovery year in terms of global positioning. The report was released on Tuesday by the United Nations Conference on Trade and Development (UNCTAD). Inflows in 2025 are reported at nearly US$19 billion, with a specific figure of US$18.89 billion cited for India.

UNCTAD: India’s 2025 inflows rose 44% year-on-year

UNCTAD reported that FDI into India climbed nearly 44% year-on-year in 2025. In absolute terms, inflows rose to US$18.89 billion from US$17.09 billion in 2024. The jump is presented as evidence of stronger investor interest, supported by an “active policy framework” to diversify investment and accelerate advanced manufacturing. The report also describes the global recovery in investment as continuing but “fragile,” even though overall flows held up through 2025. For India, the data point to a sharp improvement on the previous year’s base.

Global FDI flows grew 6% to US$1,600bn

At the global level, UNCTAD said worldwide FDI flows increased 6% in 2025 to US$1,600 billion. Developed economies recorded an 11% rise in flows, while developing economies saw a 2% increase. The report characterises global FDI as “resilient” in 2025, but it also flags that the recovery remained fragile. This context matters for India because the country’s year-on-year rise occurred alongside uneven gains across regions and country groups.

South Asia’s inflows climbed to US$16bn, driven by India

South Asia saw a strong regional rise in investment flows, according to the report. UNCTAD said FDI inflows into South Asia increased from US$14 billion to US$16 billion. It added that the rise was “largely driven by India,” where inflows expanded to around US$19 billion in 2025. The region-wide numbers highlight how India’s performance can influence South Asia’s aggregate outcomes in global FDI comparisons. The report’s regional framing also signals that India’s improvement was large enough to move the needle at the South Asia level.

Policy focus: services diversification and advanced manufacturing

UNCTAD attributed India’s consolidation as an investment destination in 2025 to an active policy framework. The report specifically pointed to efforts to diversify investment beyond the services sector and to accelerate the growth of advanced manufacturing. Separately, the Hindi portion of the provided text also references government policies to modernise manufacturing and push the services sector forward. While the report does not quantify the contribution of individual policy measures, it positions policy continuity as a supporting factor for the 2025 inflow recovery.

FY2025-26: DPIIT reports US$18.85bn total FDI inflows

Alongside UNCTAD’s calendar-year 2025 numbers, India’s fiscal-year data show a different picture because the period and coverage differ. As per data cited from the Department for Promotion of Industry and Internal Trade (DPIIT), India received total FDI inflows of US$18.85 billion during FY2025-26 (April 1, 2025, to March 31, 2026). This represented an 18% increase compared with the previous financial year. The FY2025-26 figure includes equity inflows, reinvested earnings, and other capital contributions, as described in the provided text. These fiscal-year totals are not directly comparable to the UNCTAD calendar-year 2025 inflow number, but together they indicate sustained activity across reporting frameworks.

Sources, states, and sector mix in FY2025-26

The FY2025-26 breakdown highlights where capital came from and where it went within India. Singapore retained its position as India’s largest source of FDI equity capital, contributing US$19.8 billion during FY2025-26. The United States emerged as the second-largest contributor, with equity inflows more than doubling year-on-year to US$11.17 billion.

On a cumulative basis since April 2000, Singapore and Mauritius remained the two largest contributors in equity inflows, at nearly US$194.7 billion and US$186.8 billion respectively. At the state level, Maharashtra remained the leading destination in FY2025-26 with US$18.4 billion in FDI equity inflows, while Karnataka’s inflows nearly doubled to US$12.9 billion. By sector, computer software and hardware was the largest recipient of FDI equity inflows in FY2025-26 at US$13.9 billion, rising from US$1.8 billion in the previous year.

Key figures at a glance

Market impact: what the numbers indicate for investors

The UNCTAD data place India’s calendar-year 2025 inflows at close to US$19 billion and show a meaningful year-on-year rise. That improvement helped India move up the global ranking to 11th position and contributed significantly to South Asia’s rise in total inflows to US$16 billion. For market participants tracking cross-border capital allocation, the ranking shift and the scale of the year-on-year increase offer a clear, quantifiable signal that India attracted more project and corporate investment capital in 2025 than in 2024.

Fiscal-year data add detail on the domestic distribution of investment. The FY2025-26 DPIIT figure of US$18.85 billion, along with source and sector-level numbers, points to continued strength in technology-linked categories such as computer software and hardware. State-level concentration is also visible, with Maharashtra and Karnataka together accounting for large equity inflows in FY2025-26. These splits matter for listed ecosystem themes tied to IT services, hardware supply chains, industrial parks, and state-specific infrastructure and policy execution.

Analysis: returns, stability, and the gap between gross and net flows

CareEdge Ratings’ analysis cited in the provided text places India second only to Indonesia in average risk-adjusted returns on inward FDI. It said India’s average return on inward FDI remains at 7.3%, and that on a risk-adjusted basis measured as the ratio of absolute return to standard deviation, India ranks second among major countries analysed.

At the same time, CareEdge noted a divergence between gross inflows and net flows. Over the last five years (FY20-25), annual gross FDI inflows were described as hovering between US$10 billion and US$15 billion, with a flat CAGR of around 2%. But it also stated that net FDI flows fell from US$14 billion in FY20 to US$1 billion in FY25. The same dataset added that in H1 FY26, gross FDI inflows increased 16% year-on-year to US$10 billion, while profit repatriation declined 5% year-on-year to US$16 billion. Together, these figures underline why investors often track both gross inflows and the offsetting impact of repatriations and other outflows.

FY2024-25 snapshot: provisional total of US$11.04bn

The provided text also cites provisional fiscal-year inflows for FY2024-25 at US$11.04 billion, a 14% rise from US$11.28 billion in FY2023-24. It states that services accounted for the largest share of equity inflows in FY2024-25 at 19%, followed by computer software and hardware at 16% and trading at 8%. It also reports that FDI in services surged 40.77% to US$1.35 billion, while manufacturing increased 18% from US$16.12 billion in FY2023-24 to US$19.04 billion in FY2024-25. Separately, one note in the text mentions FDI inflows exceeding US$10 billion in FY2024-25, described as a 13% rise from US$14.4 billion in the previous year.

Conclusion: India’s 2025 rebound shows up in rank and flows

UNCTAD’s World Investment Report 2026 places India at 11th globally for FDI destination rankings in 2025, with inflows rising 44% to US$18.89 billion. The same report shows global FDI up to US$1,600 billion and highlights South Asia’s rise to US$16 billion, largely driven by India. Fiscal-year data from DPIIT and other cited summaries add granularity on sources, states, and sectors, and point to sizeable flows in FY2024-25 and FY2025-26 under different measures. The next major reference points for investors will be subsequent releases of official fiscal-year inflow datasets and any future updates in UNCTAD’s global assessments.