Foreign Direct Investment (FDI) in the first ten months (July-April) of the current fiscal year has reached $3.02 billion - the highest ever in the country''s history, as against $0.89 billion in the same period last year, thus, registering an increase of 238.7 percent.
According to Economic Survey 2005-06 FDI is expected to reach $3.5 billion or 2.7 percent of GDP by the end of the current fiscal year.
FDI has become an important source of private external finance for developing countries. It is different from other major types of external private capital flows in that it is motivated largely by the investors'' long-term prospects for making profits in production activities in the host countries.
Almost 75.0 percent of FDI have come from six countries, namely, the UAE, US, Saudi Arabia, Switzerland, UK and the Netherlands. The UAE with 42.5 percent ($1284.6 million) has topped the list of foreign investors followed by the US (13.9% or $419.1 million), Saudi Arabia (9.06% or $273.7 million), Switzerland (5.34% or $161.5 million), UK (5.0% or $151.4 million) and the Netherlands (2.9% or $87.1 million).
Telecom, energy (oil, gas and power), financial services, trade, construction, chemicals, food and personal services have been the major recipient of FDI, accounting for almost 94 percent or $2.082 billion. Telecom sector has been the single largest recipient of FDI with $1.0 billion followed by the energy sector ($304 million), financial services ($265.5 million), trade ($81.9 million), construction ($54.4 million), food ($52.7 million), personal services ($45.2 million) and cement ($33.6 million).
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