Summary:

FDI inflows will increase as a result of India's extension of free trade agreements, tariff rationalisation, and enhanced business environment, according to ADB Chief Economist Albert Park. Net FDI increased to US$ 3 billion in April–December of FY26 after declining from Rs. 2.88 crore (US$ 38.6 billion) in FY22 to Rs. 2.25 crore in FY23 and Rs. 84,435 crore in FY24. Competitiveness is anticipated to increase with trade liberalisation, supply chain integration, and improvements to the manufacturing ecosystem. Labour, GST, and urban governance reforms make conducting business easier and draw in investors. Tensions in the Middle East and oil prices, which are expected to reach US$96 in 2026 and US$80 in 2027, are risks. Despite this, domestic demand and reforms are expected to maintain India's GDP growth of 6.9%.

Source: IBEF

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