India received FDI inflows worth $84.8 billion in fiscal 2021-22, despite the impact of the pandemic and geopolitical developments, it noted.

India has the potential to attract FDI worth $475 billion in the next five years, according to a report by EY and the Confederation of Indian Industry. Seventy-one per cent of global firms working in India considers the country as a key destination for their global expansion and their optimism is driven by both short-term and long-term prospects, it said.

The direction of India’s growth is being determined by the strong momentum in domestic consumption, services, digital economy and infrastructure, it said.

A majority of MNCs feel the Indian economy will perform significantly better in three to five years, with 96 per cent of respondents being positive about the country’s overall potential, the report, titled ‘Vision – Developed India: Opportunities and Expectations of MNCs’, said.

“We are confident that the continuing reform momentum by the government will attract increasing volume of investment from MNCs and facilitate their larger integration in domestic supply chain,” CII director general Chandrajit Banerjee was quoted as saying by a news agency.

India is not only among the fastest-growing large economies, the confidence in its potential stems from strong consumption trends, digitisation and a growing services sector, along with the government’s strong focus on infrastructure and manufacturing, the report said.

Over three-fifths of MNCs admitted to improvement in the business environment in the last three years. MNCs appreciate the impact of the goods and services tax, the digital push in various spheres and transparency in taxation, amongst other reforms, it added.

Fibre2Fashion News Desk (DS)