India has received over 20 foreign direct investment queries in the past two months following the United States' recent tariff move, according to government sources, as companies across sectors such as chemicals, automobiles, textiles, and electronics are exploring manufacturing and investment options in India.
Officials said global firms are reassessing supply chains due to the US-China trade tensions and are increasingly considering India as a manufacturing and investment hub. They said India is positioned to expand its manufacturing base and raise exports, as companies diversify production away from China.
“There's a marked uptick in companies wanting to establish manufacturing operations in India. The US tariff move has accelerated this shift, and India's cost-effective, scalable ecosystem is a major draw,” a senior official involved in FDI clearances told NDTV Profit.
Some of the recent FDI proposals include joint ventures with minority Chinese stakes, primarily in non-sensitive sectors, according to the official. The government has approved seven to eight of these proposals after detailed due diligence and security reviews.
The official said India continues to maintain its policy focus on local control and mandatory technology transfer in joint ventures. Despite these conditions, investor sentiment has remained strong.
Officials attributed this to government schemes such as the Production-Linked Incentive programme and sector-specific reforms, which they said have enhanced India's investment appeal.
“India has a competitive edge over global peers—not just in terms of cost, but also in terms of market diversity and regulatory stability,” the official noted. “The current global scenario is pushing companies to de-risk and realign their supply chains, and India is clearly benefitting from that shift.”
Officials said India is expected to continue using this momentum to draw high-value, long-term FDI aligned with its ‘Make in India' and economic self-reliance initiatives.
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