**Executive Summary**
This document is an answer provided by the Minister of State in the Ministry of Finance on 08.12.2025 to Unstarred Question No. 1196 raised in Lok Sabha regarding foreign companies' projects in the country. It addresses concerns about foreign companies dropping projects and provides details on Foreign Direct Investment (FDI) inflows into India. The Union Budget 2025-26 announced further increases in FDI sectoral caps, specifically for the insurance sector.
**Key Points / Main Content**
* **FDI Importance:**
* FDI is considered a major source of non-debt financial resources for economic growth.
* Gross FDI flows into India have consistently grown over the last decade.
* **Government Initiatives for FDI:**
* The government has implemented measures to stimulate FDI inflows.
* An investor-friendly policy is in place, with most sectors (except strategically important ones) open for 100% FDI under the automatic route.
* More than 90% of FDI inflow is received under the automatic route.
* India continues to open its economy to global investors by raising FDI limits, removing regulatory barriers, developing infrastructure, and improving the business environment.
* **FDI Trends:**
* FDI inflows increased from USD 36.05 billion in FY 2013-14 to USD 80.62 billion in FY 2024-25.
* FDI inflow reported during the first half of FY 2025-26 (USD 50.36 billion) has increased by 16% compared to the same period last year (USD 43.37 billion).
* This is the highest ever FDI inflow for the first half of a financial year.
* **Budget Announcement:**
* The Union Budget 2025-26 announced a further increase in the FDI sectoral cap for the insurance sector from 74% to 100%.
**Impact Analysis**
**Global Investors**
*Impact:*
* The increase in FDI limits, reduced regulatory barriers, infrastructure development, and business environment improvements will attract increased investments.
*Action Required:*
* Take advantage of the new policies and streamlined processes for FDI.
**Insurance Sector**
*Impact:*
* The increase in the FDI sectoral cap from 74% to 100% provides new investment opportunities.
*Action Required:*
* Adapt strategies to accommodate higher FDI and explore potential partnerships.
**Indian Economy**
*Impact:*
* FDI inflows will contribute to economic growth by providing non-debt financial resources.
*Action Required:*
* Continue to monitor and improve policies and infrastructure to further attract FDI.
Key Entities Referenced
Foreign Direct Investment (FDI): The primary subject of the document, concerning FDI inflows and policies related to foreign companies' projects in India.
Ministry of Finance: The ministry responsible for providing the answer to the question, highlighting its role in matters related to FDI.
India: The country where the FDI policies and projects are being discussed.
Union Budget 2025-26: Referenced as a document impacting FDI, specifically mentioning changes to the insurance sector's FDI sectoral cap.
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
LOK SABHA
UNSTARRED QUESTION NO. 1196
ANSWERED ON 08.12.2025
Foreign Companies Projects in the Country
1196. Shri Selvaganapathi T.M.:
Will the Minister of Finance be pleased to state:
(a) whether it is a fact that the foreign companies are dropping their projects in the country
and are slowing down on making new project announcements, if so, the details
thereof;
(b) whether it is also a fact that foreign companies halted projects worth over Rs. 2 lakh
crore in the country during the first quarter of the current financial year, if so, whether
such impact is more than 1200 per cent higher than the corresponding quarter last
year, if so, the details thereof;
(c) whether it is also true that the value of the projects dropped by foreign companies was
higher since the year 2013-2014; and
(d) if so, the details and the reasons therefor?
ANSWER
MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI PANKAJ CHAUDHARY)
(a) to (d).Foreign Direct Investment (FDI) is considered as a major source of non-
debt financial resource for economic growth. Gross FDI flows into India have grown
consistently over the last more than a decade. The Government has implemented
various measures to stimulate FDI inflows. The Government has put in place an
investor-friendly policy, wherein most sectors except certain strategically important
sectors, are open for 100% FDI under the automatic route. More than 90% of the
FDI inflow is received under the automatic route. India continues to open up its
economy to global investors by raising FDI limits, removing regulatory barriers,
developing infrastructure and improving business environment. For instance, the
Union Budget 2025-26 also announced for the further increase of FDI sectoral cap
for the insurance sector from 74% to 100%.
FDI inflows into India have increased from USD 36.05 billion in financial year 2013-
14 to USD 80.62 billion in financial year 2024-25. FDI inflow reported during the first
half of financial year 2025-26 (USD 50.36 billion) has increased by 16% compared
to year ago period (USD 43.37 billion). It is the highest ever FDI inflow for 1st half
of a financial year.
****