According to the FDI report 2017, compiled by FDI Intelligence, a division of The Financial Times Ltd., India remains ahead of China and the US in terms of green field FDI inflows in the year 2016. In the year 2015, India surpassed these two economic giants for the first time to become the Numero Uno in FDI investments.
If you are wondering what green field means, here's the explanation. It's a scenario wherein a foreign-headquartered company directly invests in another country, compared to Brownfield investments which occur when a company or government purchases an existing facility in a particular country to begin a new production.
The report says that the FDI capital investment saw an increase of 2% to the US$ 62.3 billion in 2016 compared to the US$ 62 billion in 2015 in India.
If we look at the global scenario in 2016, green field FDI continued to rise worldwide, with capital investment growing by more than 6 percent to the US$ 776.2 billion.
The report said, "India managed to keep the crown as the world's number one location for green field capital investment for the second year running ahead of China and the US."
The huge spurt in the investment also proves that India has become the 'growth engine' of global companies, beating all the developed economies.
When there's an increase in Foreign Direct Investment, no doubt the country grows by leaps and bounds. When country's GDP rises, it leads to a higher Per Capita income. The country also becomes economically sound with more revenues flowing through the projects. Overall there's a better quality of life.
According to Firstpost, China has overtaken the US to become the second biggest country for FDI by capital investment. China has recorded US$ 59 billion of announced FDI, compared to the US$ 48 billion.
The Financial Times report also states that the global investment landscape has changed considerably in 2016 as FDI gravitated to locations experiencing the strongest economic growth, while locations in recession or facing high levels of uncertainty saw major declines.
In 2016, 809 projects were covered under FDI, which mostly benefited Infrastructural and Real Estate sector.
The report also states that in 2016, green field FDI continued to rise worldwide, with capital investment increasing by more than 6% to US$ 776.2 billion, highest since 2011, alongside an increase in job creation by 5% to 2 million. However, the number of FDI projects declined 3% to 12,644.
Globally, the real estate sector has secured the top spot for investment, with US $ 157.5 billion FDI recorded in 2016, an increase of 58 percent. However, in value terms, coal and natural gas witnessed an inflow of US$ 121 billion, followed by alternate and renewable energy at the US $ 77 billion.
India's continuing as the top investment destination for the second year in a row means that the government is working hard to strike a chord with foreign investors and bring more and more funds.
And more investment means more jobs, more affluence and more happiness.