- Net FDI in India turned positive at $4.6 billion in February 2026 after six months of decline
- Gross inward FDI rose 61.6% year-on-year to $8.98 billion in February, the highest in seven months
- Outflows of direct investment fell to $4.4 billion, lowest in 27 months, due to reduced repatriation by firms
India's foreign investment outlook received a strong boost in February 2026, with net foreign direct investment (FDI) turning positive after six consecutive months of decline, according to data released by the Reserve Bank of India.
Net FDI stood at $4.6 billion in February, marking a sharp turnaround from negative $1.4 billion in January 2026 and negative $703 million in February 2025. The latest figure is also the highest level in nearly four years (45 months), signalling renewed investor confidence.
The improvement in net FDI was driven by a simultaneous rise in inflows and a steep fall in outflows. Gross inward FDI surged 61.6% year-on-year to $8.98 billion in February, a seven-month high, compared with $5.56 billion in the same period last year. This indicates sustained interest from global investors in India's growth story.
At the same time, total outflows of direct investment dropped to $4.4 billion, the lowest level in 27 months. A key factor behind this decline was reduced repatriation by foreign firms.
Repatriation, funds sent back by foreign investors, fell significantly to $1.7 billion in February 2026, down from $2.5 billion a year earlier and sharply lower than nearly $5 billion in January 2026.
This marked reduction played a crucial role in boosting net FDI, as lower capital exits combined with rising inflows improved the overall balance.
Outward FDI Also Contracts
Outward investments by Indian companies also saw a notable decline. Net outward FDI dropped 31.03% year-to-year to $2.63 billion in February, compared with $3.77 billion in the year-ago period.
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According to the RBI, nearly 75% of these outward investments were directed towards Singapore, the UAE, and the UK, highlighting continued strategic expansion by Indian firms in key global markets.
Strong FY26 Trend Despite Volatility
The February rebound has also lifted overall FDI performance for the financial year. For the April–February period of fiscal year 2026, net FDI stood at $6.3 billion, significantly higher than $1.5 billion in the same period last year.
Meanwhile, gross FDI inflows for the first 11 months reached $88.3 billion, registering an 18.1% increase year-on-year, underlining India's sustained attractiveness as an investment destination.
The RBI maintained that India continues to be an “attractive destination for greenfield FDI projects.” However, data from global tracker fDi Markets indicates a nuanced trend.
Greenfield project announcements declined 11% to $65 billion during April–January fiscal year 2026, compared with the same period last year, suggesting some moderation in fresh project commitments despite strong overall inflows.
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