India has spent much of the past three decades positioning itself as a destination for international capital. Foreign investment has financed industrial facilities, brought multinational companies into domestic markets and helped integrate Indian businesses into global supply chains. Yet a new set of figures from the Reserve Bank of India suggests that the relationship is becoming more complex. Indian enterprises are building substantial financial interests overseas, while the composition of foreign investment in India reveals differences between publicly traded companies, privately held businesses and the jurisdictions through which international capital moves.
On 6 November 2026, the RBI released the provisional findings of its annual census on the foreign liabilities and assets of Indian direct investment entities for 2025–26. At the end of March 2026, outstanding foreign direct investment in reporting entities stood at approximately ₹70.72 lakh crore, compared with ₹65.17 lakh crore a year earlier. Their outstanding overseas direct investment, meanwhile, rose from ₹11.87 lakh crore to ₹16.71 lakh crore. The ratio of inward to outward direct investment consequently narrowed from 5.5 to 4.2 in a single year. In rupee terms, the inward investment stock increased 8.5%, while the outward stock expanded approximately 40.8%. 1
These figures do not establish that foreign investors are withdrawing from India or that Indian companies are collectively relocating their operations overseas. They measure outstanding investment positions rather than the amount of fresh capital crossing borders during the year. Changes in asset valuations, exchange rates and the population of reporting companies can alter those positions independently of new investment transactions. Nevertheless, the figures reveal a consequential development: Indian entities' overseas financial interests have grown substantially relative to the foreign investment interests recorded within India.
A narrowing investment gap
The census provides a useful comparison of the two sides of India's direct investment relationship. Its figures reflect accumulated investment positions at financial year-end, rather than annual flows.
| Indicator | March 2025 | March 2026 |
|---|---|---|
| Outstanding inward FDI | ₹65.17 lakh crore | ₹70.72 lakh crore |
| Outstanding outward DI | ₹11.87 lakh crore | ₹16.71 lakh crore |
| Inward-to-outward ratio | 5.5 times | 4.2 times |
| Inward FDI, US dollar equivalent | $761.54 billion | $747.13 billion |
| Outward DI, US dollar equivalent | $138.67 billion | $176.59 billion |
Source: RBI, Foreign Liabilities and Assets Census 2025–26, Table 3B. Figures are outstanding positions; dollar equivalents use the respective year-end exchange rates. 1
One of the more revealing features is the difference between the rupee and dollar measurements. Outstanding inward investment increased in rupee terms, yet its dollar equivalent declined from approximately $761.5 billion to $747.1 billion. The distinction arises because outstanding rupee values are converted at each financial year-end exchange rate. A weaker rupee can reduce the dollar value of an investment position even when the rupee value increases.
This is not a minor accounting detail. International investment statistics are often interpreted as indicators of investor confidence or capital withdrawal. But changes in portfolio values alone cannot establish whether investors are committing additional money, withdrawing capital or responding to currency movements. The RBI explicitly cautions that changes in outstanding foreign assets and liabilities differ from investment flows recorded in the balance of payments because the former incorporate valuation effects. 1
Flow statistics offer a different perspective. In its October 2026 statistical bulletin, the RBI reported approximately $97.0 billion in gross direct investment inflows into India during 2025–26. Repatriation and disinvestment amounted to approximately $54.1 billion, leaving direct investment into India on a net inward basis of around $42.9 billion. After accounting for Indian direct investment abroad, net foreign direct investment was approximately $6.7 billion. Those are transactions during a year; the November census records accumulated positions at year-end. 2
Direct investment abroad may fund acquisitions, subsidiaries, distribution networks, technology access or financial arrangements within corporate groups. An overseas subsidiary may help an Indian manufacturer reach international customers, while an offshore holding company can be part of a group's ownership structure. These have distinct consequences for domestic production and employment. Outward investment cannot automatically be described as capital escaping India, just as inward investment does not invariably create new domestic productive capacity.
The geographical data show Singapore as the largest destination for India's outstanding outward direct investment, at 21.1% as of March 2026, followed by the United Arab Emirates at 16.2%, the United States at 13.9% and the United Kingdom at 12.4%. Together, the first three accounted for slightly more than half of the overseas position reported by the census. 1
The UAE figures are especially notable. Its outstanding direct investment position rose from approximately ₹1.04 lakh crore to ₹2.71 lakh crore, with a substantial increase appearing in debt instruments. The census establishes the change in scale and accounting classification, but does not reveal which individual transactions or corporate structures produced it. It would therefore be premature to attribute the movement to a particular company, acquisition or industrial strategy without examining additional records.
Who is investing in India?
The geographical composition of inward investment presents another set of questions. According to the RBI census, the United States accounted for 16.5% of outstanding inward FDI at the end of March 2026, followed by Mauritius at 14.5%, Singapore at 13.7% and the United Kingdom at 10.8%. The Netherlands accounted for another 10.2% and Japan 9.0%. These are shares of accumulated investment positions, not simply the investment received in the latest year. 1
The Department for Promotion of Industry and Internal Trade's annual equity inflow statistics give a different ordering. In 2025–26, Singapore supplied approximately $19.8 billion in recorded FDI equity inflows, or 34% of the total. The United States contributed about $11.17 billion, or 19%, and Mauritius approximately $6.58 billion, or 11%. Thus, the United States was the largest source of outstanding investment stock in the RBI census, while Singapore was the largest source of fresh FDI equity flows reported by DPIIT for that financial year. 3
These findings are compatible. The stock measure accumulates investments over time and reflects subsequent valuation movements; the flow measure concerns capital recorded during a specified period. Treating them as interchangeable would obscure rather than clarify India's international investment relationships.
There is a further complication: the jurisdiction from which an investment is recorded is not necessarily the country where the ultimate controlling investor resides. Multinational businesses often hold assets through intermediate companies in third countries. The International Monetary Fund has described how FDI statistics based on the immediate investing economy can differ materially from statistics classified by the ultimate investing economy. 4
This matters when reading the prominent positions of Mauritius, Singapore and the Netherlands. Their presence shows the importance of legal and financial channels through which investment is held, not the ultimate nationality of every investor behind those vehicles. Nor does the existence of a multinational holding structure imply wrongdoing. Ownership chains can reflect ordinary commercial or financial arrangements, and the ultimate controllers must be established using appropriate records.
For regulators, investors and the public, understanding beneficial ownership can affect assessments of governance, taxation and economic concentration. A country-wise investment table is an essential starting point, but it cannot on its own explain who ultimately controls an enterprise.
The census contains another finding largely absent from public discussion. Of 43,123 Indian entities reporting inward or outward direct investment at the end of March 2026, 41,814 were unlisted—approximately 97% of the reporting population. Among entities with inward direct investment, about three-quarters qualified as foreign subsidiaries because a single foreign investor held more than half their equity. 1
This means much of India's internationally invested corporate sector sits outside the listed equity market. Listed-company disclosures are valuable, but they do not describe the entire distribution of foreign capital among privately held enterprises, operating subsidiaries and holding companies.
The value-based figures also need careful interpretation. At face value, unlisted firms accounted for 97.9% of FDI equity capital. On the RBI's market-value measure, listed and unlisted entities held almost equal shares of outstanding FDI equity. For unlisted firms the RBI applies an own-funds-at-book-value approach, whereas listed equity is measured using market prices. These methodologies produce very different ways of looking at a single investment landscape. 1
The sectors receiving foreign capital
Manufacturing represented 50.1% of outstanding inward FDI equity capital at market value in the RBI's March 2026 data, while services represented approximately 45%. Within the services sector, finance, insurance, telecommunications and information services were particularly substantial. The data therefore do not support a simplistic picture in which foreign investment is confined to one part of the economy. 1
Annual inflow figures again tell a different story. DPIIT recorded computer software and hardware as attracting approximately 24% of FDI equity inflows in 2025–26, services 17% and trading 7%, with non-conventional energy and food processing at roughly 5% each. Sector definitions and measurement bases differ between the sources, so the figures should not be assembled into a single ranking without adjustment. 3
The more important question is what investment accomplishes after it arrives. Buying an existing company's shares can increase a foreign investment position without financing a new factory or creating an equivalent amount of productive capacity. Conversely, capital placed in manufacturing or services can support equipment, research, jobs or acquisitions, depending on its ultimate use. Recorded investment value is not itself a measurement of additional production.
Policymakers therefore need evidence about productivity, employment, domestic supply chains and corporate performance in addition to capital totals. An economy attracting increasingly large investment positions will benefit in different ways depending on where businesses deploy those resources and how the resulting gains are distributed.
The provisional census includes 43,123 reporting entities, compared with 41,517 in the preceding annual exercise; 36,127 entities appeared in both rounds. Changes in survey coverage can affect aggregate comparisons alongside currency fluctuations, business valuations and actual transactions. These methodological limits are part of the evidence and should not disappear from the headline analysis. 1 5
The RBI's wider international investment position provides additional context. At the end of June 2026, India recorded approximately $1.21 trillion in international financial assets and $1.43 trillion in liabilities, leaving net non-resident claims of approximately $220.3 billion. The broader position includes portfolio investment, reserve assets and other categories, and must not be equated directly with the narrower corporate direct-investment census. 6
What the census ultimately documents is a two-directional investment relationship. Foreign corporations maintain substantial interests in Indian businesses, while Indian entities hold a growing value of investment overseas. This may offer opportunities for expansion and international integration, while also sharpening questions about ownership transparency, exposure to international markets and the location of future economic activity.
The central question is not simply how much capital enters or leaves India in a given year. It is where that capital is deployed, who controls it, whether it supports productive activity and how its benefits spread through the economy. India’s future investment position will be shaped as much by what its enterprises build abroad as by what overseas businesses choose to finance at home.
Methodology: This analysis uses RBI's provisional 2025–26 Foreign Liabilities and Assets Census released 6 November 2026; its previous census; RBI balance-of-payments data; DPIIT foreign-equity inflow data; and IMF research. Stock figures refer to outstanding positions at the stated dates. Flow figures are annual transactions. No interviews or unpublished datasets are claimed.