New Delhi: Foreign direct investment (FDI) in India declined by about 20 percent to USD 2.26 billion in August compared to same month in the previous year, after registering increase in the inflows in the previous month.
In August 2011, the country had received foreign investment worth USD 2.83 billion.
The foreign inflows were up by about 60 percent in July.
During April-August 2012 the FDI inflows dipped by 60 percent to USD 8.16 billion from USD 20.63 billion in the same period last year, an official in the Department of Industrial Policy and Promotion (DIPP) said.
When asked about the reason for decline in the FDI, the official said that these numbers are fluctuating in nature.
However, he said decisions like allowing FDI in multi- brand retail and civil aviation would help in boosting investments in the country in the coming months.
Industry experts say foreign investments are important for India, which needs to fund over USD 1 trillion over the next five years to overhaul its infrastructure sector like ports, airports and highways key to boost growth.
Decline in foreign investments puts pressure on the country's balance of payments (BoP) and could also impact the rupee.
Sectors which received large FDI inflows in the month under review include services (USD 2.28 billion), automobile (USD 617 million), construction (USD 601 million) and metallurgical (USD 595 million).
India received maximum FDI from Mauritius (USD 2.53 billion), Japan (USD 1.16 billion), the Netherlands (USD 923 million), the UK (USD 570 million) and Singapore (USD 961 million).
The inflows had aggregated to USD 36.50 billion in 2011-12 against USD 19.42 billion in 2010-11 and USD 25.83 billion in 2009-10.
Foreign inflows in April, May and June dipped to USD 1.85 billion, USD 1.32 billion and USD 1.24 billion compared to USD 3.12 billion, USD 4.66 billion and USD 5.65 billion, respectively in the a year-ago period.