The Hindu Business Line : Foreign investors still prefer services sector

NEW DELHI: The services sector continues to remain the favourite destination for foreign investors as the country attracted $2.62 billion FDI in the segment in the first six months of the current fiscal.

Services, which contributes the largest chunk to the country’s gross domestic product, attracted 22 per cent of the total FDI inflows of $15.31 billion in the April-September period of the current fiscal, official data show.

In 2008-09, the services sector, including financial and non-financial segments, attracted the maximum foreign direct investment worth $6.11 billion.

“Cost competitiveness of skilled manpower in India is the major reason for this...in the coming times also this sector will attract maximum investments,” international trade expert with Indian Institute of Foreign Trade (IIFT) Mr R M Joshi said.

Telecommunications followed the services sector, attracting $2 billion of FDI. Real estate with $ 1.89 billion worth of inflows was the third best choice of the foreign investors.

In the country’s total FDI inflows in the first half financial year, the maximum was from Mauritius - $6.52 billion. It was followed by the US and Singapore.

However, overall FDI during the period declined by 11 per cent to $15.31 billion from $17.21 during April- September of 2008-09. - PTI

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