Trends in Industry Sectors and Geographic Locations Attracting Maximum Outward FDI from India

Abstract

In recent years, India has focused on foreign direct investment (FDI) actively participating in internal as well as outward investment. While outward FDI (OFDI) plays a crucial role in the country's economic growth and export expansion, it remains relatively underexplored in terms of guiding FDI decisions in foreign markets. This study investigates various industries to empirically examine OFDI trends and their relationship with geographic locations that attract FDI from India. The research evaluates different industrial sectors involved in OFDI to identify which sectors and regions are most attractive to Indian investors. Using data from the Reserve Bank of India (RBI) spanning 2011 to 2024, the analysis employs advanced tools like EViews, Tableau, and Python. The findings provide deeper insights into OFDI trends, with a time series analysis of Joint Ventures as well as Wholly Owned Subsidiaries highlighting the investments made by different Indian sectors. The results demonstrate that Indian companies have a wide scope of investment with Wholly Owned Subsidiaries specifically in financial and business services dominantly in developed countries.