FDI in services sector grows by 46% in 2014-15 fiscal

Foreign Direct Investment (FDI) inflows into the services sector grew by over 46 per cent to 3.25 billion dollars in 2014-15 fiscal. It was revealed by the Department of Industrial Policy and Promotion (DIPP).
The FDI in this sector has increased after government had taken series of steps to improve ease of doing business and attracting domestic as well as foreign investments.
The services sector includes banking, outsourcing, insurance, Research & Development (R&D), courier and technology testing.
Earlier in 2013-14, FDI in this sector was worth 2.22 billion dollar. However, the total foreign inflow in 2014-15 in the services sector was low as compared to 2012-13 when it was 4.83 billion dollars.
Apart from services sector, overall foreign inflows in the country too have rose by 27 per cent to 30.93 billion dollars during 2014-15 fiscal. In 2013-14, the foreign inflow was 24.29 billion dollars. It should be noted that services contribute about 60% to India’s GDP.
The other sectors where FDI inflows have recorded growth are telecommunications ($2.89 billion), automobiles ($2.57 billion) and computer software and hardware ($2.20 billion).
Increase in foreign investments will help to improve country’s balance of payments (BoP) situation and strengthen the rupee.

Month: Current Affairs - June, 2015