Investment climate in India has improved considerably since the opening up of the economy in 1991.
This is largely attributed to ease in FDI norms across sectors of the economy. India, today is a part of the top 100 clubs on Ease of Doing Business (EoDB). FDI inflows in India stood at $45.15 bn in 2014-15 and have consistently increased since then. Moreover, total FDI inflow grew by 65.3%, i.e. from $266.21 bn in 2007-14 to $440.01bn in 2014-21 and FDI equity inflow also increased by 68.6% from $185.03 bn during 2007-14 to to $312.05 bn (2014-21).
India has attracted a total FDI inflow of $27.37 bn during the first four months of F.Y. 2021-22 which is 62% higher as compared to the corresponding period of F.Y. 2020-21 ($ 16.92 billion).
FDI inflows in India from April to December were $67.54 bn. It is the highest ever for the first ninth months of a financial year and 22% higher as compared to the first ninth months of 2019-20 ($55.14 bn).
Total FDI inflows in the country in the last 21 years (April 2000 – March 2021) are $763.5 bn while the total FDI inflows received in the last 5 years (April 2014- September 2019) was $319 bn which amounts to nearly 50% of total FDI inflow in last 20 years.
During FY 2020-21, total FDI inflow of $58.37 bn, 22% higher as compared to the first 8 months of 2019-20. FDI equity inflows received during April – November 2020 is $43.85 bn which is 37% more compared to April – November 2020 ($32.11 bn).
FDI equity inflow grows by 168% in the first three months of FY 2021-22 ($17.57 bn) compared to the same corresponding period last year ($6.56 bn).
Automatic Route
Under the Automatic Route, the non-resident investor or the Indian company does not require any approval from the Government of India for the investment.
Government Route
Under the Government Route, prior to investment, approval from the Government of India is required. Proposals for foreign direct investment under Government route, are considered by the respective Administrative Ministry/ Department.
India’s food ecosystem offers huge opportunities for investments with stimulating growth in the food retail sector, favorable economic policies, and attractive fiscal incentives.
Through the Ministry of Food Processing Industries (MoFPI), the Government of India is taking all necessary steps to boost investments in the food processing industry in India. The government has sanctioned 41 food parks funded under the Mega Food Parks Scheme of which 38 have final approval. In 2014, there were only 2 Mega Food Parks in the country. As of 1 August 2021 there are 22 Mega Food Parks functioning in the country. Now the target is to take their number to more than 40.
India records close to 15% rise in export of agricultural and processed food products in April-October.
100% FDI is permitted under the automatic route in food processing industries in India.
The Food Processing sector in India has a quintessential role in linking Indian farmers to consumers in the domestic and international markets. The Ministry of Food Processing Industries (MoFPI) is making all efforts to encourage investments across the value chain. The food processing industry engages approximately 1.93 mn people in around 39,748 registered units with fixed capital of $32.75 bn and aggregate output of around $158.69 bn. Major sectors constituting the food processing industry in India are grains, sugar, edible oils, beverages, and dairy products.
Under PMKSY, 41 Mega Food Parks, 353 Cold Chain projects, 63 Agro-Processing Clusters, 292 Food Processing Units, 63 Creation of Backward & Forward Linkages Projects & 6 Operation Green projects across the country have been approved.
The key sub-segments of the Food Processing industry in India are Fruits & Vegetables, Poultry & Meat processing, Fisheries, Food retail, dairy industry, etc.
Key facts:
100% FDI is allowed through the government approval route for trading, including through e-commerce in respect of food products manufactured or produced in India.
The country’s FDI Policy for the metals and mining sector allows:
India has large reserves of Iron ore, Bauxite, Chromium, Manganese ore, Baryte, Rare earth and Mineral salts.
The Metals and Mining sector in India is expected to witness a major reform in the next few years, owing to reforms such as Make in India Campaign, Smart Cities, Rural Electrification, and a focus on building renewable energy projects under the National Electricity Policy as well as the rise in infrastructure development.
*The production level of important minerals in March 2021 were: Coal 960 lakh tonnes, Lignite 52 lakh tonnes, Bauxite 2,103 thousand tonnes, Chromite 601 thousand tonnes, Copper conc 11 thousand tonnes, Iron ore 227 lakh tonnes, Lead conc 41 thousand tonnes, Manganese ore 331 thousand tonnes, Zinc conc 164 thousand tonnes, Limestone 391 lakh tonnes, Phosphorite 124 thousand tonnes, Magnesite 12 thousand tonnes, Gold 148 kg, and Diamond 34 carat.
*The production of important minerals showing positive growth during March 2021 over March 2020 included Manganese Ore (80.1%), Lead conc. (74.9%), Phosphorite (57.0%), Copper conc. (50.2%), Chromite (45.8%), Limestone (45.6%), Magnesite (44.9%), Zinc conc. (43.2%), Bauxite (33.4%), Lignite (25.3%), Iron ore (13.7%), and Coal (0.2%)
19 coals blocks were auctioned in 2020 for commercial mining. The total expected revenue from these mines is around INR 7,000 cr with a combined peak capacity of 51 MPTA.
The second tranche of auction for commercial coal mining offered 67 mines for sale of coal in March 2021.
By Agnii
As efforts towards clean energy transitions gather momentum globally, emerging and developing countries will play an important role in shaping outcomes. There are distinct market conditions and developmental priorities shared by developing countries, but without clear communication across national borders, knowledge gaps are bound to arise.
To facilitate awareness regarding common energy innovation challenges, AGNIi, in partnership with International Energy Agency (IEA), organized a working-level dialogue between emerging economies on commercializing clean energy innovations on September 30, 2021. The target audience for this discussion were relevant public investment bodies responsible for technology innovations, commercialisation and foreign direct investment (FDI).
The International Energy Agency (IEA) is an autonomous intergovernmental organisation that works with governments and industries to shape a secure and sustainable energy future for all. It is at the heart of global dialogue on energy, providing authoritative analysis, data, policy recommendations, and real-world solutions to help countries provide secure and sustainable energy.
The workshop took place over two hours and featured a presentation on the importance of clean energy innovation and investments from Araceli Fernández, Head of the IEA Technology Innovation Unit. Following this, there were a series of presentations from each country representative on their clean energy technology priorities, support programmes for energy innovators and interest in international collaboration on market development and investment. Each presentation was followed by a Q&A session with the participants.
The countries that presented at the workshop, along with their representative organizations, are as follows:
The workshop was intended to highlight opportunities created by participating countries to foster innovation in the clean energy space.
The AGNIi Mission, both co-organized the workshop and served as India’s representative on the same. We remain committed to both strengthening our national innovation ecosystem in clean energy, as well as organizing more forums wherein the international community can demonstrate their commitment to cleantech and showcase the opportunities for innovators in the sector.