India attracted about $27 billion of foreign direct investment (FDI) in the manufacturing sector in the last nine years despite liberalising rules, while China received $40 billion FDI inflows per year, a study has said.
India has been attracting $3.4 billion FDI in the manufacturing sector on an average every year between January 2000 and September 2008, a Ficci study revealed.
"While India's total FDI is 37 per cent in the manufacturing sector that of China is 67 per cent," it said.
This remains much below the potential considering the vast market that is available in the country and 100 per cent FDI allowed in almost all the manufacturing sectors, it said.
However, it added, "It may not be difficult to get $12 billion of FDI in the manufacturing sector alone per annum for the next five years, which could be scaled up in subsequent years."
India's share remains negligible in the outward FDI stock of developed countries in the top manufacturing sectors such as chemicals, automobiles, food processing, electrical and electronic equipment, metals and machinery equipment.
There are a number of strategic areas such as industrial and agricultural machinery, ship building, medical and surgical devices and computer hardware, which have not attracted much inflows, while the country continues to import large amount of these machinery and equipment in the absence of sufficient domestic capacity to meet the demand.
