FDI inflows touches new record

New Delhi, Apr 19 (UNI) Commerce and Industry Minister Kamal Nath said the country has received a record Foreign Direct Investment (FDI) in equity inflows.

The Minister disclosed this while announcing the Annual Supplement to the Foreign Trade Policy (2004-09) here today.

He said, "I must mention about the robust growth in our Foreign Direct Investment. A liberal Trade Policy has a direct effect on FDI flows and the two are inter-related." He said the year 2006-07 has seen our FDI equity inflow go up to almost 16 billion dollar from 5.5 billion dollar in the previous year -- almost tripling the inflows in one year. In last three years the Government has seen a staggering 725 per cent increase in FDI inflows -- up from 2.22 billion dollar in 2003-04 to 16 billion dollar in 2006-07. In line with the international practice of including the retained earnings reinvested, the FDI touched 19 billion dollar in 2006-07, constituting 2.3 per cent of the GDP.

This is about 6.8 per cent of the gross capital formation or gross investment in the economy, he said. ''I am sure, this is quantum jump compared to only 0.5 per cent of the GDP and about 1.5 per cent of gross investment three years ago. The directional flow of the FDI into manufacturing and export of goods and services is contributing immensely to our export efforts,'' he added.

UNI