India Inc's investments abroad have more than doubled in the previous financial year as Indian companies expanded overseas operations, as per data released for the first time by the Reserve Bank of India.
Foreign direct investment (FDI) by Indian firms was up more than two-folds in financial year 2010-11, at $43.9 billion from about $18 billion in the previous year, according to the data.
Oversees investments by Indian corporates stood at $5.1 billion during the first two months of the current financial year starting April.
The Indian government has been liberalising policies governing investment overseas over the years to promote exports and strengthen economic links with other countries.
"In the post 2003 period, the policy has enabled corporate entities and registered partnerships to invest in bonafide businesses abroad, currently to the extent of 400 per cent of their net worth, under the automatic route," the RBI said in a release on its website.
India has been facing a decline in foreign institutional investment on account of global risk aversion, as foreign funds have sold nearly $213 million of local shares so far in June, offloading $1.16 billion in May.
However, FDI flows into India were up again in April on an investment surge in services, construction and auto sectors, reversing a steep drop recorded in the previous financial year.
Investments in equity, loans and guarantees issued by Indian firms to their joint ventures or wholly owned subsidiaries (WoS) comprise the FDI by Indian companies.
The largest outward investment from India in May this year has come from Gammon India Ltd, which pumped over $ 1.83 billion into its Panama-based joint venture, Campo Puma Orient SA.
Tata Steel invested $514.57 million in its Singapore-based subsidiary Tata Steel Asia Holdings PTE in May.