India is poised to see robust growth in foreign direct investment (FDI) in 2026, backed by strong macroeconomic fundamentals, large-scale investment commitments, streamlined regulatory processes, and a new generation of trade agreements.
The Department for Promotion of Industry and Internal Trade (DPIIT) and Commerce Minister Piyush Goyal have engaged extensively with stakeholders to enhance India’s investor-friendly policies, reduce compliance burdens, and improve ease of doing business. These measures include decriminalising minor industry offences, faster approvals, and targeted reforms aimed at sustaining long-term FDI.
In 2024-25, India attracted a record USD 80.62 billion in FDI. Preliminary data for January–October 2025 show gross overseas investments crossing USD 60 billion. DPIIT Secretary Amardeep Singh Bhatia said, “We are hopeful that 2026 may surpass last year’s record, given the momentum of policy reforms and investor interest.”
Strategic trade agreements are expected to bolster inflows. The India-European Free Trade Association (EFTA) pact, effective October 1, 2025, commits the bloc to invest USD 100 billion over 15 years. On the very day of the pact, Swiss pharma giant Roche announced a USD 1.5 billion investment in India over five years. Similarly, the India-New Zealand FTA, slated for 2026, brings a USD 20 billion investment pledge.
Also read: RCEP minus China: India’s strategic trade win
Global corporates are also ramping up commitments. Microsoft plans USD 17.5 billion by 2030 for AI and infrastructure, Amazon USD 35 billion over five years for cloud, AI, and quick commerce expansion, and Google USD 15 billion for an AI hub. Apple and Samsung are increasing their Indian operations, while Arcelormittal Nippon Steel India plans to raise its colour-coated steel capacity to 10 lakh tonnes by 2026.
Economic resilience further supports these inflows. India grew 8.2 per cent in Q2 of 2025-26, while reforms such as the Jan Viswas Bill are simplifying business processes.
Experts highlight technology-led services as the key magnet for FDI. “AI, data analytics, cloud infrastructure, and global capability centres are expected to attract sustained foreign capital,” said Rudra Kumar Pandey of Shardul Amarchand Mangaldas & Co. Deloitte India economist Rumki Majumdar noted that India’s diversification in economic partnerships will channel greater long-term investments into software, electronics, and services.
Major sources of FDI include Mauritius and Singapore (49 per cent), followed by the US (10 per cent), the Netherlands (7.2 per cent), Japan (6 per cent) and the UK (5 per cent). Key sectors attracting investment are services, IT, telecom, construction, automobiles, chemicals, and pharmaceuticals.
FDI remains crucial for India’s infrastructure needs, growth trajectory, balance of payments stability, and rupee value.
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