NEW DELHI: Foreign direct investment in the services sector rose marginally to USD 1.03 billion during the April-July period of the ongoing fiscal, according to the Department of Industrial Policy and Promotion data.
The services sector, which includes banking, insurance, outsourcing, R&D, courier and technology testing, had received FDI worth USD 1.02 billion during the first four months of the previous fiscal, 2013-14.
The government is taking steps to boost inflows into the sector and has decided to raise FDI limit to 49 per cent in the insurance sector from the current level of 26 per cent, said an official.
The services sector contributes over 60 per cent to India’s GDP. In 2013-14, foreign investment in the sector fell to USD 2.2 billion from USD 4.83 billion in 2012-13.
The other sectors which received high foreign investment during the first four months of this financial year include telecommunication, construction, computer software and hardware and power.
Foreign investments are considered crucial for India, which needs around USD 1 trillion over five years (2012-17) to overhaul its infrastructure sector such as ports, airports and highways to boost growth.
The overall FDI during April-July this fiscal has jumped by 52 per cent to USD 10.73 billion.