India is now the recipient of the fifth-largest inflows in the world as it received $64 billion in the form of foreign investment in the world, as per a UN report. It also mentioned that the second wave of COVID-19 in India pushes profoundly on the country’s economic activities but at the same time, the country’s solid fundamentals render a ray of hope.
With COVID-19 taking a toll on countries all over the world, lockdowns initiated in various countries delayed pre-existing investment projects and prospects. This has caused the recession led multinational enterprises (MNEs) to rethink existing as well as new projects.
The UN Conference on Trade and Development (UNCTAD) released the World Investment Report 2021 on Monday, which indicated that global FDI flows have been decreased due to the pandemic and they fell by 35 per cent in 2020 to anywhere between $1 trillion from $1.5 trillion last year.
Although many sectors have taken a hit, the global pandemic increased the demand for digital infrastructure and services globally. This caused a rise in value for greenfield FDI project announcements with the focus on the Information and communications tech industry, as it rose by more than 22 per cent to $81 billion.
The World Investment Report 2021 mentioned that in India FDI increased by 27 per cent to $64 billion in 2020 which is a climb from the FDI in 2019 at $51 billion. most of the FDI was acquisitions in the information and communication technology (ICT) industry thus causing India to be the fifth-largest FDI recipient in the world.