India witnessed a dramatic decline in Net Foreign Direct Investment (FDI) during August 2025, with official figures revealing a staggering 159% fall. This unprecedented reversal means that capital flowing out of the country significantly surpassed new investments entering it, marking the second instance this fiscal year where outflows have dominated.
Despite this concerning monthly dip, a broader perspective across the April-August 2025 period presents a much brighter scenario. Over these five months, net FDI actually surged by more than 121% compared to the same period last year, indicating that the August performance might be an anomaly within an otherwise positive trend.
Delving into Investment Figures
Gross investments into India plunged to $6,049 million in August 2025. This represents a substantial 30.6% decrease from August of the previous year and a sharper 45.5% drop from July’s figures, marking the lowest gross inflow recorded this fiscal year.
Meanwhile, the total capital exiting India, comprising repatriation and disinvestment by foreign firms, reached $4,928 million in August 2025. While this was a slight 5.4% reduction from August 2024, it showed a nearly 30% increase compared to July 2025.
Adding to the outflows, foreign investments made by Indian companies abroad contracted to $1,736 million, a 29.7% drop and the lowest for this financial year.
Collectively, these figures resulted in a negative net FDI of -$616 million for August 2025. This means a net amount of money left India, rather than entering, a situation last observed in May 2025, albeit on a smaller scale with a -$5 million net outflow.
A Brighter Horizon in the Long Run
Looking at the cumulative picture, India’s net FDI for April-August 2025 stood robustly at $10,128 million. This impressive figure reflects a 121% increase over the same period last year, fueled by an 18.2% rise in gross inflows, totaling $43,760 million.
Furthermore, repatriation and disinvestment outflows during this period actually saw a 6.1% contraction, reaching $21,205 million, contributing to the positive net balance.
Foreign investments by Indian companies during April-August 2025 also grew by nearly 26%, totaling $12,427 million, underscoring a dynamic engagement in global markets.