Foreign direct investment (FDI) flows into India bounced back in April, on an investment surge in services, construction and auto sectors, reversing a steep drop recorded in the previous fiscal year, the government said on Monday. In April, the first month of the 2011/12 fiscal year, FDI into India rose an annual 43 percent to $3.1 billion, with analysts expecting the year to show an improvement in such flows owing to previously announced big-ticket projects.
FDI inflows had fallen to $19.43 billion, down a quarter, in the last fiscal year that ended in March, as foreign investors shunned Asia's third-largest economy over policy paralysis from a series of corruption cases, regulatory hurdles and lack of reforms.
That decline has posed worries for the slowing Indian economy and for balancing its trade and current accounts, with Finance Minister Pranab Mukherjee last week saying that the government was in the process of pushing forward reforms, including easier FDI norms, to attract foreign investors. The service sector, which saw investments rise an annual 21 percent to $658 million in April, was the top recipient of FDI inflows, the trade and industry ministry said in a statement. FDI in the construction sector, including into roads, were up by 7 percent to $311 million in April. The automobile sector attracted $266 million.
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