India climbed two positions to become the world's 11th largest recipient of foreign direct investment (FDI) in 2025, recording a 44% rise in inflows to $39 billion, according to the latest World Investment Report. The report identifies the country as an increasingly attractive destination for investments across electronics, automobiles, materials and industrial manufacturing.
The publication by UNCTAD also showed India advancing two places to rank as the 18th largest source of overseas investment. Outward FDI increased 50% to $36 billion in 2025. The sharp rise in overseas investments has reduced net FDI inflows, a trend that the government and economists have attributed to the expanding international presence of Indian companies and their growing role in global value chains (GVCs).
"India has emerged as a major recipient because of its scale, fast-growing digital demand, technical skills and expanding markets for cloud services," the report said, while noting the continued policy emphasis on boosting manufacturing investments through initiatives such as the Production Linked Incentive scheme.
"The policy framework in India remains oriented towards advanced manufacturing, infrastructure development and deeper integration into GVCs. However, tariff uncertainty, supply chain realignment and weaker global investment sentiment are affecting the scale of new manufacturing and infrastructure commitments," it added.
Among the largest greenfield project announcements, Alphabet's $14.5 billion investment in a data centre and Polish renewable energy company Hynfra's $4.1 billion commitment in India featured in the global top 10. The report also included Rana Group's $10 billion investment in the auto parts sector in the UAE among the biggest announced projects.
The report highlighted megaprojects, particularly those linked to digital infrastructure, as a growing trend in global FDI. India was identified as one of the key beneficiaries of this shift, alongside Egypt, the UK and Brazil.
According to the World Investment Report 2026, investment patterns have continued to evolve across countries and sectors. Since 2021, India has emerged among the top five destination markets for investments originating from the US, the EU, South Korea and Japan. However, it did not feature among China's leading investment destinations, a trend the report suggested was likely linked to the investment checks introduced by India in 2020.
The report also observed that China had lost ground as an investment destination for both the EU and the US, indicating an ongoing recalibration in global investment strategies.
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