Singapore has replaced Mauritius as the top source of foreign direct investment (FDI) into India during the first half of the current fiscal year 2015-16.
It was unveiled by the data during April to September 2015 period released by the Department of Industrial Policy and Promotion (DIPP).
Key facts:
- India has attracted 6.69 billion dollars FDI from Singapore while it received 3.66 billion dollars from Mauritius.
- Highest foreign investment sector wise : Computer software and hardware (3.05 billion dollars), trading (2.30 billion dollars), services and automobile (1.46 billion dollars each) and telecommunications (659 million dollars).
- Foreign investment from Singapore has more than doubled from 2.41 billion dollars in the same period in FY year 2014-15.
- Overall, Singapore accounts for 15 per cent of the total inbound FDI received by India during April 2000 and September 2015. However, Mauritius accounted for 34 per cent of FDI during the same period.
Singapore has replaced Mauritius as the top source of foreign direct investment (FDI) into India during the first half of the current fiscal.
During April-September 2015, India has attracted $6.69 billion (Rs 43,096 crore) FDI from Singapore while from Mauritius, it received $3.66 billion (Rs 23,490 crore), according to data from the Department of Industrial Policy and Promotion (DIPP).
Foreign investment from Singapore has more than doubled from $2.41 billion in the year-ago period.
According to experts, the Double Taxation Avoidance Agreement (DTAA) with Singapore incorporates Limit-of-Benefit (LoB) clause, which has provided comfort to foreign investors based there to invest in India.
“Investors are preferring Singapore to Mauritius as the LoB clause in India-Singapore treaty provides substance and certainty,” said Krishan Malhotra, head of tax and an expert on FDI with corporate law firm Shardul Amarchand and Mangaldas.
FDI from Singapore during the first six months of the current financial year is also more than what it had invested in India for the whole of 2013-14 ($5.98 billion). India had attracted $6.74 billion foreign investment during 2014-15.
Overall, Singapore accounts for 15 per cent of the total FDI India received during April 2000 and September 2015.
However, Mauritius makes up 34 per cent of FDI during the same period.
Sectors that attracted highest foreign investment during April-September 2015 includes computer software and hardware ($3.05 billion), trading ($2.30 billion), services and automobile ($1.46 billion each) and telecommunications ($659 million).
Foreign investment is crucial for India, which needs about $1 trillion by March 2017 to overhaul infrastructure such as ports, airports and highways and boost growth.
FDI or Foreign Direct Investment
- It refers to international investment in which the investor obtains a lasting interest in an enterprise in another country.
FPI or Foreign Portfolio Investment
- It represents passive holdings of securities such as foreign stocks, bonds, or other financial assets, none of which entails active management or control of the securities’ issuer by the investor.