7 major sectors attracting FDI for India
International investors have shown interest in Indian market amid all the global concerns. The Ernst & Young's 2012 attractiveness survey indicates that companies continue to be convinced by India’s growth and foresee their presence in the country as a positive long-term opportunity: more than 60 percent of companies already present in India plan to increase their operations in the country. 1. Infrastructure
The number of FDI projects in the Infrastructure sector grew by 90 percent in 2011 in India. The sector contributed 4 percent to the total number of FDI projects and 9 percent to the total jobs created. Development in the country’s infrastructure is poised to accelerate as the Government of India plans to double its infrastructure spending from US$500 billion to US$1 trillion during FY2012–17.
The automotive sector in India attracted 78 FDI deals during 2011, an increase of 28 percent in comparison to the same period in 2010. Although the sector made up 8 percent of total FDI projects in India, it created most jobs (16 percent). India is now the world’s seventh-largest passenger vehicle manufacturer, and the second-largest medium and heavy commercial vehicles and 2-wheelers market.
3. Retail and consumer products
The number of projects in the consumer products sector grew by 31 percent in 2011. The sector made up 10 percent of total FDI projects in India and created over 28,400 jobs. Investors in consumer products are interested in accessing India’s rapidly growing middle class, which is increasingly able to afford consumer products. In particular, investors have observed growth in the packaged food and beverages sector. The Government of India, however, did not back down from allowing 100 percent foreign investment in single brand retail from the current 51 percent. This will help some of the well-known apparel single brand firms that are keen on entry into India
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