Why are Singaporeans investing in India?

For the seventh consecutive fiscal year, Singapore has maintained its status as India’s leading source of foreign direct investment (FDI). In 2024-25, investments from Singapore surged to $14.94 billion, up from $11.77 billion the previous year, reflecting a robust 27% increase. This growth underscores Singapore’s pivotal role in channeling capital into India, contributing approximately 19% of the nation’s total FDI inflows for the period. Since overtaking Mauritius in 2018-19, Singapore has consistently driven significant investment, leveraging its position as a global financial powerhouse.

​India’s overall FDI, encompassing equity inflows, reinvested earnings, and other capital, climbed 14% to $81.04 billion in the last fiscal year, marking a three-year high. Beyond Singapore, other nations like Mauritius ($8.34 billion), the United States ($5.45 billion), and the Netherlands ($4.62 billion) also contributed significantly. Sectors such as financial services, technology, logistics, and pharmaceuticals have attracted substantial interest, with Singapore acting as a conduit for global private equity and venture capital funds targeting India’s high-growth market. Experts highlight Singapore’s stable economy, advanced financial ecosystem, and favourable tax agreements as key drivers.

​Singapore’s appeal as an investment hub stems from its low-tax environment, robust legal framework, and the India-Singapore Double Tax Avoidance Agreement, which reduces tax liabilities for Singapore-based firms investing in India. Analysts, including economists and legal experts, note that Singapore’s sophisticated financial markets and political stability make it an ideal gateway for capital flowing into Asia. While Singapore is expected to remain a dominant investor, the evolving landscape suggests growing competition from other nations. India’s ability to attract stable, long-term investments continues to bolster infrastructure development and economic stability.