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[RBI] Census On FLA Of Indian Direct Investment Companies 2016-17

Jan 19, 2018: Today, the Reserve Bank released the provisional results of the 2016-17 round of the annual census on foreign liabilities and assets (FLA) of Indian direct investment companies. This census covers Indian companies that have cross-border liabilities and assets arising on account of foreign direct investment (FDI) in India and/or overseas direct investment (ODI).

Of the 18,667 companies that responded, 17,020 companies had FDI/ODI in their balance sheets in March 2017. Over 80 per cent of the 15,169 companies that reported inward FDI were subsidiaries of foreign companies (i.e., single foreign investor holding above 50 per cent of total equity).

The census yields comprehensive information on the market value of foreign liabilities and assets of Indian companies arising on account of FDI, ODI and other investments. It is important to note that changes in outstanding asset/liabilities would be different from flows recorded in the balance of payments (BoP) during a year, as the former would also include valuation changes due to price and exchange rate movements.

Main Findings:

 o 96 per cent of the responding companies were unlisted in March 2017 and most of them had received only inward FDI; unlisted companies had higher share of FDI equity capital vis-à-vis listed companies (Tables 1 and 2A).

 o Non-financial FDI companies had a much higher share in total foreign equity participation vis-a-vis financial FDI companies (Table 2B).

 o The ratio of market values of inward to outward direct investment, increased to 4.3 in March 2017 from 3.6 a year ago; equity participation accounted for 94 per cent and 79 per cent shares in inward and outward FDI, respectively (Table 3).

 o FDI companies reported a marginal increase in other investment liabilities, which include trade credit, loans, currency and deposits and other payables with unrelated (third party) non-resident entities (Table 4).

 o Mauritius was the largest source of FDI in India (21.8 per cent share at market value) followed by the USA, the UK, Singapore and Japan whereas Singapore (19.7 per cent) was the major ODI destination, followed by the Netherlands, Mauritius, and the USA (Tables 5 and 6).

 o The manufacturing sector accounted for nearly half of the total FDI at market prices; ‘information and communication services’ and ‘financial and insurance activities’ were the other major sectors that attracted FDI (Tables 7 and 8).

 o Total sales, including exports, of foreign subsidiaries in India increased by 18.7 per cent during 2016-17 whereas their purchases, including imports, increased by 20.1 per cent (Tables 10A and 10B).

 o Exports of foreign subsidiaries accounted for 30.7 per cent of sales whereas imports constituted 37.8 per cent share of purchases (Tables 10C and 10D).

 o In respect of overseas subsidiaries of Indian companies’ sales and purchases; the purchase-to-sales ratio was 81.3 per cent (Table 9A and 9B).

 o Exports made up 30.8 per cent of sales of overseas subsidiaries in 2016-17, whereas imports accounted for 57.9 per cent of purchases (Table 9C and 9D).

For data at TABLES NO. 1 TO 10D - check RBI site