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MARCH 2026

Repositioning India in a

Shifting Global FDI Landscape:

Trends, Challenges, and

Strategic Priorities

I ndia’s trajectory toward global economic This article examines global FDI trends, evaluates
leadership is closely linked to its ability to attract
India’s evolving position, analyses recent
and effectively utilise foreign capital. This has
gained added significance in a global environment developments, and identifies the key structural
constraints shaping its investment potential.
marked by geopolitical tensions, economic
uncertainty, and shifting investor priorities that
continue to reshape capital flows. At the same time, the Global FDI Context
nature of FDI is evolving, with investors increasingly
favouring high-technology and future-oriented The global FDI landscape has undergone significant
sectors, while traditional global value chain industries shifts in recent years, driven by geopolitical tensions,
have seen relatively weaker momentum. economic uncertainty, and changing investor
preferences.
In this context, India’s FDI performance must be
assessed not only in terms of aggregate inflows, but According to UNCTAD’s World Investment Report
1
2
also in terms of their composition, sustainability, and 2025 , global FDI declined by 11 per cent in 2024 ,
alignment with broader development objectives. marking the second consecutive year of contraction.
This article is contributed by Dr Neha Gupta, Director, Ease of Doing Business, MNCs and GVCs, Confederation of Indian Industry (CII)

1 UNCTAD. (2025). World Investment Report 2025: International investment in the digital economy. Geneva, Switzerland: UNCTAD
2 As per the UNCTAD Report, the global FDI flows actually reported a 4 per cent rise to reach US$1.5 trillion in 2024, but this was largely due to flows
volatility through several European conduit economies serving as financial transfer points. Excluding these, global FDI is found to decline by 11 per cent
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