E&Y: India is world’s fourth most attractive FDI destination

The survey notes that private equity has evolved greatly in the last decade, with 2,000 Indian companies receiving PE funding in the past five years and $50 billion invested between 2007 and 2011, The Business Standard reported. "PE has emerged as a very important investor in India Inc and with the long term India growth story still intact, PE funds continue to look eagerly at investing in India," Ernst & Young said.

This comes despite "ups and downs over the past decade." A combination of deteriorating LP sentiment toward India and macroeconomic uncertainty are expected to hit fundraising this year. AVCJ Research shows that in 2009 and 2010, LPs committed $4 billion and $2.5 billion respectively, to 29 funds each time. Nearly double this number are expected to seek capital in 2012 and sources tell AVCJ that less than $3.5 billion is likely to be committed.

The top five foreign direct investment destinations in India are Bangalore, Mumbai, Chennai, New Delhi and Pune. They represent 43% of the investment projects, 34% of the jobs created and 26% of cumulative FDI value. On a sector basis, technology attracted the largest number of FDI projects, followed by retail and consumer products. However, India is tipped to become one of the world's top three manufacturing centers by 2020.

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• Topics
• South Asia
• Investments
• India
• Ernst & Young
• FDI
• Fundraising