- DDI grew by 29.9% YoY in Q4-23, outpacing FDI which grew by 2.07% YoY in USD terms. Altogether, direct investment reached ~USD 94.7 Bn (14.2% YoY) in FY2023.
- The slowdown in FDI is likely associated with the upcoming presidential elections, economic slowdown in major investment partner countries, and falling commodity prices.
- Meanwhile, the strong DDI is a reflection of domestic companies’ robust appetite for CAPEX amid the government’s “downstreaming” push.
- Slowing corporate earnings, as well as uncertainty regarding the new government administration’s policies, may prove to be headwinds for direct investment in the coming quarters.
