United Nations: The FDI inflows to India in 2025 surged by 73 per cent to USD 47 billion, mainly due to large investments in services and manufacturing, supported by policies aimed at integrating the country into global supply chains, the UN said.
The Global Investment Trends Monitor, released by the United Nations Conference on Trade and Development (UNCTAD), stated on Thursday that the Foreign Direct Investment (FDI) inflows to China declined for the third consecutive year, falling by 8 per cent to an estimated USD 107.5 billion.
“FDI inflows to India surged by 73 per cent to USD 47 billion, mainly due to large investments in services“ including finance, IT, and R&D“ as well as manufacturing, supported by policies aimed at integrating India into global supply chains,” UNCTAD said.
It added that global foreign direct investment reached an estimated USD 1.6 trillion in 2025, a 14 per cent increase.
However, a significant part of the increase was due to higher flows through several major global financial centres and investment hubs (economies with significant conduit FDI flows), which added more than USD 140 billion to the total, with the United Kingdom, Luxembourg, Switzerland and Ireland“ in that order “ accounting for the bulk.
FDI flows to North America remained broadly stable. The United States – the world’s largest FDI recipient – recorded a 2 per cent increase in inflows. Cross-border M&A activity declined by 22 per cent to USD 132 billion. While M&A sales decreased across most industries, they rose sharply in semiconductors and telecommunications, it said.
The report added that the total value of international project finance increased by 7 per cent to USD 218 billion, while the number of projects declined by only 5 per cent. Project finance activity increased in Syria, the Philippines, Viet Nam, and Uzbekistan, but declined in Egypt and India.
Data centres drove much of the FDI trend in 2025, recording an increase of USD 125 billion in greenfield announcements and of USD 30 billion in international project finance.
The bulk of the growth was thus through greenfield investment, contrasting with the traditionally more important role of international project finance within the telecommunications sector.
Proprietary infrastructure is becoming increasingly important due to growing competition in AI technology.
India was among the top 10 major recipients of data centre investments in 2025, it said, adding that foreign investment in data centres is concentrated in a handful of countries. France, ranked number 1, the United States (2) and the Republic of Korea (3) led as host countries, while emerging markets such as Brazil (4), India (7), and Malaysia (9) also attracted major projects.
“Total greenfield investment in data centres surpassed USD 270 billion, representing more than one-fifth of all investment projects. The leading host countries for these investments were France, the United States, and the Republic of Korea. Notably, emerging markets such as Brazil, Thailand, India, and Malaysia also ranked among the top ten hosts of data centre projects,” it said.
PTI