Indian companies have increased their overseas investment through remittances, which reached a new record of $36 billion during the first eleven months of FY25.
According to Reserve Bank of India data, this is a significant increase of 40% over the outflow of $25.2 billion during the same time period of FY24 and notably higher than $24.8 billion in FY23.
February saw ODI flow of $5.35bn — the largest monthly figure for at least 38months — reflecting a growing appetite by Indian corporations to finance subsidiaries, purchase assets and expand operations overseas amid the uncertain global trading conditions after Donald Trump was reelected as US president.
Singapore, US, UK top destinations
Singapore was the most popular destination for Indian ODIs, attracting 23 % of total outflows during FY25.
Singapore is often used by Indian companies as a jurisdiction intermediary due to the favourable tax agreements it has with other countries.
United States ranked 2nd, drawing 16 % of total ODI.
The volume of transactions in the US are higher than those of Singapore. However, the majority of remittances, usually below $100,000,000, are of a small value.
The majority of these are from Indian service companies, particularly in information technology.
United Arab Emirates and United Kingdom followed with 12% each.
The two regions have received funding from various sectors including metals and minerals, manufacturing, logistics.
The Netherlands, Mauritius and other countries were major recipients of Indian overseas investments.
Vedanta, Sun Pharma lead high-value ODI deals
The spike of $5.35bn in February was driven by a number of large transactions. Vedanta, for example, sent $1 billion to THL Zinc, a subsidiary based in Mauritius.
It was one of the biggest ODI transactions of the financial year.
Sun Pharma invested $829 millions in its Netherlands-based subsidiaries, contributing further to the upward trend.
Biocon Biologics, a subsidiary of Biocon Biologics UK Limited, issued guarantees in October for the joint venture it has established with the UK. This was one of the largest UK remittances made during the FY25.
The transactions show how Indian conglomerates use ODI as a tool to fund international expansion and investment plans, especially in the metals and pharmaceuticals industries.
ODIs to grow by 40% during FY25
The total ODI flows of more than $36 billion in the first quarter of FY25 represent a 40% rise compared with the same period last year.
The growth in ODIs is far greater than the total of $24.8 billion recorded in FY23. This shows a significant shift in Indian business’ global capital deployment.
ODI allows companies to remit as much as $1 billion annually for corporate purposes. This is in contrast to the Liberalised Remittance Scheme, which only permits individuals to send $250,000 abroad per year.
This includes equity investments, loan guarantees, and joint ventures or overseas subsidiaries.
The post Indian overseas investment remittances reach $36 billion for FY25 could be updated as new information becomes available
