While the gross Foreign Direct Investment (FDI) into India grew to a four-year high in June 2025, the net amount contracted more than 50% owing to faster growth in repatriations by foreign companies in India, and outward investments by Indian companies, according to data released by the Reserve Bank of India (RBI). 

The data, released as part of the RBI’s monthly bulletin, shows that this trend holds true on a quarterly basis as well. Gross investments in the June 2025 quarter grew 10.5%, but were outpaced by the growth in outward FDI by Indian companies, leading to a contraction in net FDI.

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Gross inflows into India, which measures the total amount entering the country, stood at $9.3 billion in June 2025, up nearly 22% as compared to $7.6 billion in June 2024. and $7.2 billion in May 2025. 

“Gross inward FDI reached a four-year high in June,” the RBI noted in its report. “Even so, net FDI inflows remained muted due to an increase in both repatriation of FDI and outward FDI.”

Repatriation or disinvestment, which is the amount of money foreign companies operating in India are sending outside, increased by 40.7% in June 2025 to $5.7 billion. This was even higher than the $5 billion seen in May 2025. 

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Outward FDI by Indian companies grew even faster, by more than 88%, to $2.5 billion in June 2025. As a result, net FDI, which is gross FDI minus repatriation and outward FDI, stood at $1.1 billion in June 2025, about 52% lower than its level in June last year.

On a quarterly basis, gross FDI into India increased by 10.5% in the June 2025 quarter to $25 billion, but net FDI contracted by 21% to $4.9 billion. This was because outward FDI grew by more than 79% to $7.9 billion and repatriation grew by 1.8% to $12.4 billion during this period.  

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The Congress on Monday (July 28, 2025) claimed that the net foreign direct investment has fallen steeply while domestic investors are gripped by “fear and uncertainty”, as it asked the government to support incomes, end its “crony capitalist and tax terrorism” policies, fix the GST, and protect Indian industries from Chinese dumping.

The opposition party’s assertion came after Finance Minister Nirmala Sitharaman’s reported remarks that India’s private sector investment has not kept pace with the growing public expenditure.

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In a post on X, Congress general secretary in-charge communications Jairam Ramesh said, “The Finance Minister has finally acknowledged what the INC had been saying for a long time: that private investment continues to be sluggish and is not growing at the pace desired and also expected.”

“This is even after the significant corporate tax cuts of September 2019, undertaken just before the Howdy Modi event that was held in Houston in support of President Trump’s re-election,” Mr. Ramesh said.

He further said that net FDI has fallen steeply while domestic investors are gripped by “fear and uncertainty” – thanks in large measure to “tax terrorism and policies that only favour a couple of business groups”.

“The growth of mass markets for consumption goods is being hampered by a decade-long stagnant wages crisis and a flawed GST, which awaits fundamental reform,” Mr. Ramesh argued.

“Finally, the “dumping” of cheap imports from China – which is taking place despite the loss of Indian territory in Ladakh – has also led to the closure of domestic manufacturing units, foreclosing the possibility of new investments,” he said.

“Acknowledgment is the first step. Now comes the hard part – the government needs to take action to support incomes, put an end to its crony capitalist and tax terrorism policies, fix the GST, and protect our industries from Chinese dumping,” Mr. Ramesh said.

The Congress has been attacking the government over its handling of the economy, claiming the issues of rising prices, decreasing private investment, and stagnating wages were hitting the common people hard.