FDI inflow down 42 per cent this year, says Scindia

India received $4.4 billion of foreign direct investment (FDI) in the first two months of the current fiscal year - down about 42 per cent from the year-ago period. In a written reply in parliament on Wednesday, minister of state for Commerce and industry Jyotiraditya Scindia blamed the fall on the ongoing recession.

On an annual basis, Scindia said India received $27.3 billion of FDI in the fiscal year ended 31 March 31 2009, up 11 per cent over the previous fiscal year. No target has been fixed for the current financial year, he added.

Various assessments and studies have shown that India continues to be one of the most attractive destinations for investments worldwide, Scindia said. FDI has the potential of enhancing economic activity and employment in the country by complementing and supplementing domestic investment, he said.

Meanwhile, ,department of industrial policy and promotion secretary Ajay Shankar told reporters that India's June industrial output looks promising, while FDI inflows should improve with ample liquidity and rising confidence on the economy.

"It looks promising. We expect improvement. I expect continuous improvement going forward," Shankar said on the sidelines of a CII seminar in New Delhi. "We think with liquidity improving and confidence in the economy rising, these (FDI) numbers should pick up."

The government had scaled down the FDI target from $35 billion to $30 billionlast fiscal. Cumulative FDI from April 2000 to March 2009 stands close to $90 billion.