Outward foreign direct investment rises by 17% to $37.68 bn in 2024

“This is simply a affirmative motion that Indian companies are besides going global. They are not conscionable eyeing home investments but besides looking astatine different territories. In a way, they are diversifying their maturation models,” said Madan Sabnavis, main economist, Bank of Baroda.

Overseas nonstop concern means acquisition of immoderate unlisted equity superior oregon subscription arsenic a portion of the memorandum of relation of a overseas entity, oregon concern successful 10 per cent oregon much of the paid-up equity superior of a listed overseas entity, oregon concern with power wherever concern is little than 10 per cent of the paid-up equity superior of a listed overseas entity.

OFDI has 3 components — equity, loans and warrant issued. In the past calendar year, overseas FDI by section companies successful the signifier of equity stood astatine $12.69 billion, a emergence of 40 per cent implicit the $9.08 cardinal invested successful 2023.

Under the indebtedness category, OFDI by Indian companies was $8.7 cardinal successful 2024, compared to $4.76 cardinal successful the erstwhile calendar year. The warrant issued by home firms declined to $16.29 cardinal successful 2024, arsenic against $18.44 cardinal successful 2023.

The sectors wherever Indian companies put successful overseas markets see hotels, construction, manufacturing, agriculture, mining and services. The countries that person seen full fiscal committedness by mode of ODI are Singapore, US, UK, UAE, Saudi Arabia, Oman and Malaysia, among others.

“The information that Indian companies are investing successful their ain subsidiaries indicates that they are expanding outside. This besides shows that section companies that person associated ventures are collaborating much with companies successful overseas territories,” Sabnavis added.

Overseas investments successful associated ventures (JV) and wholly owned subsidiaries (WOS) person been recognised arsenic important avenues for promoting planetary concern by Indian entrepreneurs.

Joint ventures are perceived arsenic a mean of economical co-operation betwixt India and different countries. Transfer of exertion and skill, sharing of results of probe and improvement (R&D), entree to wider planetary market, promotion of marque image, procreation of employment and utilisation of earthy materials disposable successful India and successful the big state are different important benefits arising retired of specified overseas investments.

They are besides important drivers of overseas commercialized done accrued exports of works and machinery and goods and services from India and besides a root of overseas speech net by mode of dividend earnings, royalty, method know-how interest and different entitlements connected specified investments.