India has slipped three notches to the 11thposition in the AT Kearney Foreign Direct Investment Confidence Index for 2018. The US remained in the top position for investment intentions with Canada rising to the second position while Germany fell to the third.

Overall, India remains among the top investment destinations due to its sheer market size and rapid economic growth. “We are in a very exciting space of growth, opportunity and transformation. For long India has been a very exciting destination for investors. And now especially with the current political stability and positive reforms environment, India will only gain its attractiveness as an investment destination,” says Vikas Kaushal, Managing Director and Country Head, AT Kearney India. The IMF projects India’s economy will grow 7.4 per cent in 2018, the fastest growth rate of any major economy. Inward FDI flows already increased to an estimated $45 billion in 2017, a record high. Japan, US, UK, and Singapore consistently serve as large sources of FDI for India. And the country’s service sector is a target of particular interest for investors, with the government’s Economic Survey 2017–2018 noting that inward FDI into the service sector will grow 15 per cent in 2018.

“Notable reforms that have had a positive impact on India’s attractiveness include the elimination of the Foreign Investment Promotion Board, a government agency responsible for reviewing all potential foreign investment, and the liberalisation of foreign investment thresholds for the retail, aviation, and biomedical industries,” AT Kearney said in a statement.

Investors are most bullish about the economic outlook for the Asia Pacific region, with 43 per cent of investors more optimistic than last year about the region.

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