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Informist, Monday, Feb. 23, 2026

 

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--Sitharaman: Certainly no economic, commercial reasons for low FDI 
--Sitharaman: Wonder what reasons holding FDI back into India 
--Sitharaman: India econ fundamentals fine, would expect more FDI 
--Sitharaman: No concern on net FDI as of now 
--Sitharaman: No specific plan to reduce capital outflows 
--RBI Malhotra: Gross FDI robust, have sufficient FX reserves 
--RBI Malhotra: External sector robust, CAD manageable 
--RBI Malhotra: Most changes in FX reserves due to valuation changes 

 

MUMBAI – The Reserve Bank of India Governor Sanjay Malhotra Monday said gross foreign direct investment inflows into India remain robust despite a slowdown in net inflows. The foreign outflows are due to repatriations by those who have invested earlier, Malhotra said. "... the gross foreign direct investment has been very robust even this year, good growth rate last year also, this year also," the RBI governor said.

 

Gross FDI inflows into India rose 16.2% on year to $73.31 billion in Apr-Dec. However, the net FDI inflows were only $3.99 billion in the first nine months of the financial year, as repatriation rose to $44.45 billion during the period.

 

India's external sector will be strengthened by around $62 billion in inflows by tech giants, committed at the AI Summit, Malhotra said at a press conference after the RBI central board meeting. Strong inflows, together with sufficient foreign exchange reserves, have made India's external sector very strong, the governor said. The increase in India's foreign exchange reserves are mainly due to changes in valuation, the governor said. 

 

India's foreign exchange reserves rose to a record high of $725.73 billion in the week ended Feb. 13, data released by the RBI Friday showed.

 

Speaking at the same press conference, Finance Minister Nirmala Sitharaman said the fundamentals of the Indian economy are fine and foreign inflows will improve going forward. "... global capital funds move based on your macroeconomic performance, on your government stability, policy stability, taxation stability, predictability for businesses, and a law-abiding economy," Sitharaman said.   

 

The reason for the lower net foreign inflows is likely to be global politics rather than India's economic conditions, the finance minister said. "They're probably global politics... we have every reason for the funds to be attracted towards India. But if it doesn't flow, all of us will have to see what is holding it back." 

 

As of now, the government does not have a specific plan to reduce capital outflows, Sitharaman said.  End

 

US$1 = INR 90.88

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Janwee Prajapati

Edited by Saji George Titus

 

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