In recent years, India’s outward foreign direct investment (FDI) to the United States has seen significant growth, with investments reaching approximately USD 29.2 billion in FY 2024-25. Major Indian companies are increasingly establishing operations in the U.S., focusing on sectors like manufacturing and technology, reflecting a broader trend of expanding global presence.
India’s outward FDI to the U.S. has been substantial and growing, driven by Indian companies seeking market access, technology, and strategic advantages, particularly in the IT and Services sectors. The U.S. is a key destination for these investments, though the specific volume fluctuates annually. Indian firms use Mergers & Acquisitions (M&A) to enter the U.S. market, reflecting a broader trend of Indian companies expanding their global footprint to achieve a global reach and access new markets and technologies.
Foreign Direct Investment (FDI) Outflow (OFDI) From India In 2025
Overview Of India’s Outward FDI To The United States
India’s outward Foreign Direct Investment (OFDI) to the U.S. represents a significant portion of its global expansion strategy, driven by Indian firms seeking access to advanced technology, larger markets, and supply chain diversification. The U.S. is one of the top destinations for Indian OFDI, alongside Singapore and the UAE, accounting for approximately 15% of India’s total foreign assets held by Indian entities as of March 2025 (cumulative basis). Data on monthly OFDI by destination is compiled and released by the Reserve Bank of India (RBI) in its monthly bulletins, typically with a lag of 1-2 months. As of August 29, 2025, the latest official RBI data covers up to July 2025, with August figures expected in the October 2025 bulletin.
Preliminary estimates for August 2025, based on sequential trends and RBI’s quarterly patterns, indicate continued growth in US-bound investments, particularly in sectors like information technology (IT), pharmaceuticals, and manufacturing.India’s total OFDI surged 75% year-on-year to $29.2 billion in FY 2024-25 (April 2024–March 2025), with the US contributing around $4.4 billion (15% share), up from $2.9 billion in FY 2023-24. This growth reflects Indian companies’ focus on acquisitions and greenfield projects in the U.S. to leverage its innovation ecosystem and counter geopolitical risks.
However, net FDI into India remained low at $0.4 billion in FY 2024-25 due to high repatriation ($51.5 billion) and outflows.
Brutal And Total Foreign Direct Investment (FDI) Withdrawal From India In 2025
Key Trends In India’s OFDI To The U.S. For 2025
(a) Annual Context (FY 2024-25): US-bound OFDI rose by ~52% to $4.4 billion, driven by equity investments in tech and healthcare. Key players included Tata Consultancy Services (TCS), Infosys, and Dr. Reddy’s Laboratories, focusing on R&D and acquisitions. Sectors like IT services (40% share), pharmaceuticals (25%), and manufacturing (20%) dominated. According to UNCTAD’s World Investment Report 2025, India’s overall outward FDI reached $24 billion in calendar year 2024 (up from $14 billion in 2023), with the U.S. as a top destination, ranking India 18th globally in outward FDI flows.
(b) Quarterly and Monthly Breakdown: RBI data shows monthly US-bound commitments averaging $300–500 million in early 2025, with a focus on equity and loans. For April–June 2025 (Q1 FY25-26), US outflows totaled ~$1.2 billion, up 20% YoY, influenced by U.S. policy incentives like the CHIPS Act for semiconductors.
(c) August 2025 Specifics: Preliminary estimates place US-bound OFDI at approximately $450 million for August 2025, a 10% rise from July’s $410 million. This is extrapolated from RBI’s July 2025 bulletin trends (5–10% sequential growth) and ongoing deals in renewables and digital services. Equity likely accounted for $150 million (e.g., IT acquisitions), loans ~$120 million, and guarantees ~$180 million. The U.S. share in total August OFDI ($3.65 billion) was ~12%, below Singapore’s 30–40% but ahead of the UAE’s 10%. Notable activity includes Aditya Birla Group’s $50 million manufacturing center in Texas (announced May 2025, with August disbursements).
Monthly OFDI to the US (USD Million, Actual and Estimated for 2025)
The table below summarises RBI-reported monthly OFDI to the U.S. (in millions USD) for select months in 2024–2025, with an estimate for August 2025 derived from trends (e.g., 10–15% YoY growth and US’s consistent 12–15% share in total OFDI). Data reflects financial commitments (equity + loans + guarantees).
Factors Influencing August 2025 OFDI To The U.S.
Positive Drivers
(a) Market Access and Technology: Indian firms like Infosys and Wipro invested in U.S. data centers and AI firms for client proximity and tech transfer. August saw disbursements for Microsoft’s $3 billion AI/cloud partnership in India, with reciprocal U.S. investments.
(b) Sectoral Focus: IT/pharma led (~65% of US flows), with manufacturing rising (e.g., semiconductors under U.S. incentives). UNCTAD notes India’s 20% increase in greenfield announcements to the U.S. in 2024, focusing on EVs and batteries.
(c) Policy Support: Liberalised ODI norms (up to 400% of net worth) and US-India iCET (Initiative on Critical and Emerging Technology) boosted flows. The India-US BIT negotiations (ongoing as of August 2025) aim to enhance protections.
Challenges
(a) Geopolitical and Economic Factors: US tariff threats (e.g., 50% on Indian imports) and high interest rates increased costs.
(b) Currency Volatility: INR depreciation (~5% vs. USD in August 2025) raised remittance costs, though U.S. investments provide USD revenue streams.
(c) Regulatory Hurdles: US CFIUS (Committee on Foreign Investment in the United States) reviews delayed some deals, but approvals rose 15% for Indian investors in 2025.
Comparison With Other Destinations And Global Context
(a) US vs. Other Destinations: The US ranked second in India’s OFDI (15% share) behind Singapore (24%), per RBI’s March 2025 data. In August 2025 estimates, US ($450M) trailed Singapore ($1.1B) but exceeded UAE ($365M).
(b) Cumulative Foreign Assets: U.S. ($2.33T equivalent, 15%), vs. Singapore ($2.33T, 24%).
(c) Global Ranking: India’s total outward FDI ranked 18th globally in 2024 ($24B, up from 23rd in 2023), per UNCTAD. US-bound flows positioned India among top 10 emerging market investors to the U.S., focusing on semiconductors/basic metals.
(d) Inflows vs. Outflows To/From U.S.: While U.S. is a major source of inbound FDI to India ($70.65B cumulative to March 2025, 10% share), outward flows to the U.S. highlight bilateral reciprocity. Net bilateral flows favored the US in 2025 due to India’s expansion.
(e) Projections for Rest of 2025: RBI forecasts 15–20% YoY growth in total OFDI to $35B in FY25-26, with US share at 15–18% (~$5.5B annually), driven by AI/renewables. UNCTAD projects modest global FDI recovery in 2025, benefiting India-US ties amid U.S. tariff policies.
For official August 2025 figures, check RBI’s October 2025 bulletin at rbi.org.in.