India’s net FDI negative for second straight month in September as outflows exceed inflows

The Hindu
The Hindu
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India experienced negative net foreign direct investment (FDI) for the second consecutive month in September 2025, with outflows exceeding inflows by $2.4 billion. This trend highlights concerns about investment dynamics in the country.
India’s net FDI negative for second straight month in September as outflows exceed inflows
A What happened
India's net foreign direct investment (FDI) was negative for the second month in a row in September 2025, with a total of -$2.4 billion. This figure indicates that outflows from the country surpassed inflows, as foreign companies repatriated profits and Indian firms invested abroad. Gross FDI inflows rose to $6.6 billion, a 4.3% increase from the previous year, but this was overshadowed by a 64.4% increase in investments made by Indian companies overseas, totaling $3.8 billion. The overall direct investment outflow reached $9 billion, compared to the $6.6 billion inflow. Despite these short-term challenges, longer-term trends show a more positive FDI landscape, with quarterly net FDI up 172% year-on-year for Q2 and a 104% increase for the first half of the financial year.

Key insights

  • 1

    Negative FDI Trend

    India's net FDI was -$2.4 billion in September 2025.

  • 2

    Increased Outflows

    Indian companies' investments abroad surged by 64.4%.

  • 3

    Gross FDI Growth

    Gross FDI inflows rose to $6.6 billion, a 4.3% increase.

  • 4

    Long-term Improvement

    Net FDI increased by 104% in the first half of 2025.

Takeaways

The negative net FDI in September 2025 raises concerns about investment trends in India, but longer-term data suggests a more favorable outlook for foreign direct investment.

Topics

Economy