India tops South Asia in FDI receipts

Asia remained the highest recipient of Foreign Direct Investment in 2024 while global investments fell 11 per cent, revealed a new UN report released on Thursday.

In 2024, developing economies of Asia attracted $605 billion in foreign direct investment (FDI), according to the latest World Investment Report released by UN Trade and Development (UNCTAD) said.

Despite a 3% dip in value from the year before, developing Asia remained the world’s leading destination for inward foreign investment; overall in 2024, Asia received 40% of the world’s total FDI and 70% of inflows to developing economies.

Within the South Asian region, India was the top FDI recipient, the UN body said.

The report shows that foreign investment remained volatile, fragmented and highly concentrated, with many countries in the Global South\ at risk of being left behind.

“While developing Asia continues to attract a large share of global FDI, the region’s mixed performance reflects broader global patterns: declining infrastructure investment, growing digital flows and rising policy uncertainty,” it said, noting different trends across economies.

Looking at East Asia, foreign investment flows to China — the largest FDI recipient among developing economies — were down 29% in 2024.

ASEAN, remained a hot spot for foreign capital. In 2024, FDI to the bloc was up 10% at $225 billion, powered by growth across Indonesia, Malaysia, Singapore, Thailand and Vietnam.

“FDI remained stable in South Asia, with increases in Pakistan and Sri Lanka. India, despite a slight fall, still receives the most foreign investment in this subregion,” the UN said.

Turning to members of the Gulf Cooperation Council, the UAE stood out with a rebound in foreign investment, while declines were observed in other parts of the bloc.

Overall the report said global investment fell 11% in 2024.

“Project finance is collapsing in key sectors: renewable energy (-31%), transport (-32%), and water and sanitation (-30%) while digital investment rose 14%,” UNCTAD said. The report recommended modernised investment rules that balance investor protection with public interest, smarter blended finance focused on real development impact and expanded support for digital inclusion.