NEW DELHI: Singapore continued to be India’s top source of foreign direct investment (FDI) for the seventh year in a row, with inflows touching $15 billion in 2024-25. Overall, overseas equity inflows rose by 13% to $50 billion during the last fiscal year.The total FDI, that included equity inflows, reinvested earnings and other capital, reached $81.04 billion during the last financial year. This marks a 14% rise from the previous year and is the highest FDI level in the last three years.Singapore’s FDI contribution increased to $14.94 billion in 2024-25 from $11.77 billion in 2023-24, as per official government data. Singapore represented approximately 19 per cent of total inflows in 2024-25.Singapore has held the top position for FDI into India since 2018-19. Previously, in 2017-18, Mauritius was the leading source of such investments.The previous fiscal year saw Mauritius contributing $8.34 billion in foreign inflows.For 2024-25, other significant contributors included the US ($5.45 billion), the Netherlands ($4.62 billion), the UAE ($3.12 billion), Japan ($2.47 billion), Cyprus ($1.2 billion), the UK ($795 million), Germany ($469 million), and Cayman Islands ($371 million).Specialists note that Singapore’s status as an international financial centre, its strong bilateral relations with India, and its function as an access point for international private equity and venture capital contribute to its significant investment position.“Despite turmoil in the capital markets and uncertainties around trade, India has managed to attract huge investments, which are stable and long-term,” Rumki Majumdar, Economist, Deloitte India told PTI.“Given that Asia is the second largest region to receive foreign capital inflows, a large part of the funds come from Singapore. There are quite a few reasons for that. One, being a low-tax jurisdiction and with a robust legal framework, Singapore is considered the strategic financial gateway to Asia,” she said.The Double Tax Avoidance Agreement between both countries enables Singapore-based organisations to invest in India whilst reducing their total tax burden on Indian-earned income, Majumdar noted.These international investments are essential for India’s infrastructure development, including ports, airports and highways, to stimulate growth. Additionally, FDI supports the improvement of the country’s balance of payments and strengthens the rupee against other international currencies, particularly the US dollar.
