Falling FDI, bolting FPIs & declining reserves as rupee weakens: 3 big economic challenges in 2025

#CutTheClutter
Walking into 2025, the Indian economy is looking at three concerning indicators: the foreign direct investment (FDI) paradox, a foreign portfolio investment outflow & falling foreign exchange (forex) reserves. In Ep 1583 of #CutTheClutter Editor-in-Chief Shekhar Gupta and Economy Editor TCA Sharad Raghavan discuss tepid foreign investment in India, steep increase in outward investment by Indian businesses and other challenges that strengthen the case for more concrete reforms.
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[samg]

And tourism I can agree. It’s actually quite pathetic. It’s crowded and littered with garbage at almost every tourist spot. We Indians have taken it for granted. People want to chill and enjoy and fell safe not get stressed when they travel

[prashantasthana]

Main reason for decline in tourism is our own people. We have made our tourist spots ugly by littering garbage, those unhygienic food videos doing rounds and people being inhospitable. We have earned quite a reputation worldwide.

[vishwasbhandarkar]

The introduction of a 12.5% LTCG and 20% STCG reflects a potential miscalculation of the impact such policies might have on foreign investments. As a developing economy with evolving policies, India must tread carefully to avoid alienating foreign investors. Excessive or unreasonable taxation may deter investments and harm the nation's reputation as a stable and investor-friendly destination.

[Templebells]

The message is loud and clear. We have failed to manage our economy.

[karthikckrishna]

BJP supporters will pitch in supporting this … saying modi is doing great … support Hinduism .. all those shit … reduce taxes for low income and reduce taxes on petroleum and food … make life liveable and affordable …..and don’t say Congress screwed up .. we had trusted u for 14 years … still being betrayed … when u screw up acknowledge that

[Rohan__]

During his visit to Singapore, PM Modi mentioned India's aspiration to create several Singapores in India, even making this statement in the presence of the Singaporean Prime Minister. Can someone shed light on how India's current policies towards foreign investors align with Singapore's investor-friendly framework?

[aditya]

The shoddy tourist experience begins from our convoluted and tricky visa processes and gains reality at our international airports.. A basic facility like wifi, one cannot access without an OTP sent to an Indian Mobile number.. you wait until baggage claim to get wifi. If you are departing, then no wifi.. uber pick-up is intentionally inconveniently placed 1.5km from the airport and none of the cabbies eftpos machine work and international tourists dont have google pay or rupay etc.. once you exit the airport, you can't go inside to withdraw money from the only operating sbi atm. This pain will continue through the entire trip and augmented with litter and poorly managed tourist sites.
With soaring flight prices and limited annual leaves, no1 would want to waste their holidays in India. If you further analyse the international tourists data, you will find most are ex-Indian citizens coming to meet family

[himanshusingh]

In the same year Singapore got 54 billion $, Vietnam got 44 billion $, Indonesia got 40 billion $. There is thing common in these countries: better rule of law, competent buerocracy, less political intrusion.

[abhisheksingh]

Saar Modi ji should change the name of FDI to Gurdakshina, as we are the Vishwa Guru. It becomes the responsibility of other countries to give Dakshina.

[akhtarpathan]

India is not part of any major FTA, tariffs are so high, indirect taxes are so high, no big reforms, no skill development, no sustainable low inflation, how can it grow at 8+ rate, its just impossible

[manut]

the fact that government's decision to consider FII investments to be considered as FDI investments if the FII investments amounts to 10% of a company will show erroneously as an increase in FDI. Is it not tinkering with statistics.

[AmanMehraaman]

Loved this CTC episode and the new format as well. Kudos

[mg.f.]

As a Finance Minister once explained when questioned by press why is Indian Rupee falling?, the answer was "Indian Rupee is not going down, but the USD is going up."

[LikeDeep-qw]

As a developing nation - that badly relies on foreign technology, foreign jobs and foreign companies, we cannot afford to have very stringent laws and regulatory policies. Rules have to be simple and relaxed. Companies don't want to waste time on bureaucracy but want to do their core business and generate output.

[elliotalderson]

After losing money in stock market people are doing timepass. Gormint does not want you to go into data and all, they want you to go to kumbh mela.

[rajeshmadan]

When 80 crores are given free food that means they have no or very little money to buy anything. That should be the worry

[sb]

Net FDI is declining because US economy is attracting majority of global investment right now. US equity markets have never been so dominant, thanks to AI innovations and tech boom.

[manut]

In January 2020 I put money in SBI as FCNR premium for 5 years, at that time SBIs calculation was that the dollar will be about 91 Rs in January 2025 when my FCNR premium matures, So technically by 31st January 2025 if 1 dollar doesn't become Rs91, (today it is only 85.5) I am going to gain.

[manut]

The decision of the government to rename FII investments as FDI if it reaches 10% of a company, will erroneously show an increase in FDI though the actual money coming in FDI doesn't increase.

[gouthamkondapavuluru]

But the fact is that FDI comes to only 5 states of India. Sometimes statistics like this makes me feel how does it make a difference to me.