Published By: Sayan Paul

Maharashtra Tops India's FDI Chart For 2nd Consecutive Year: What Makes It An Attractive Destination For Global Investors

Maharashtra secured Rs 70,795 crores of foreign investment in Q1 FY2024-25, outperforming all other Indian states.

"We feel extremely satisfied and proud to see Maharashtra emerging as a leading state in FDI." - Devendra Fadnavis (Deputy Chief Minister, Maharashtra)

Maharashtra has long been a preferred destination for global investors. And for the first quarter of the financial year 2024-2025, the state attracted the highest Foreign Direct Investment (FDI) in India - Rs 70,795 crores, accounting for 52.46% of the country's total FDI. According to the Department for Promotion of Industry and Internal Trade (DPIIT), it has surpassed the combined total of all the other leading states, including Karnataka, Delhi, Telangana, and Gujarat. India, in total, secured Rs 1,34,959 crores in FDI during this period.

(Credit: The Maharashtra Index)

Well, Maharashtra has achieved this feat for consecutive two years now. It had received Rs 12,35,101 crore FDI in 2023-24, more than that of Gujarat, Delhi, and Karnataka combined. Commenting on this, the state's Deputy Chief Minister Devendra Fadnavis said in a statement, "... in just 2 years and 3 months, we have brought in Rs 3,14,318 crore investment! And still, the second quarter numbers are yet to be out!"

(Credit: Devendra Fadnavis)

In this article, let's discuss the major factors behind the state's position as a top destination for global investments.

Strategic Location & Connectivity

The first and most obvious reason is Maharashtra's strategic location which makes it one of the most important international gateways. Mumbai, the capital city, boasts a major port and is well-connected with all significant trade routes internationally.

Robust Infrastructure

Maharashtra boasts a remarkable infrastructure, making it a top choice for international companies looking to expand their businesses. There are over 300 industry-specific parks, an extensive highway network, several international airports, and more. Thanks to recent developments such as the Navi Mumbai International Airport, Mumbai Trans-Harbour Link, Coastal Road, and the Mumbai-Delhi Expressway, it's getting even more attention now than ever.

(Credit: Nationalist Mumbaikar)

The Diversified Economy

One of the major aspects of Maharashtra's economy is its incredible diversity. There are several IT parks in cities like Mumbai, Pune, and Nashik, leading to unprecedented software exports. Besides, the state also focuses on sectors like automobiles, electronics, textiles, pharmaceuticals, tourism, and food processing, among others. Moreover, the government last year allocated about ₹30,000 crore towards sustainable farming. The artificial intelligence and machine learning sector has recently gained a major boost as well.

(Credit: Gems of Engineering)

Thanks to this diversified economy, Maharashtra has effortlessly become a top choice for investors.

The Government's Initiatives

There's a common saying that all it takes is a visionary government to change the fortune of a state. When it comes to Maharashtra's foreign direct investments, it inarguably owes a lot to several of the state government's initiatives.

Over the years, the government has taken several initiatives to attract investors. They established the Economic Advisory Council of Maharashtra (with 21 leaders from diverse sectors) to assess opportunities for the same. Also, there's an institutional setup with dedicated departments for investor facilitation, such as Maharashtra Industry, Trade, and Investment Facilitation Cell (MAITR), Investment Promotion, Maharashtra Industrial Development Corporation (MIDC), etc. The Maharashtra Small Scale Industries Development Corporation Ltd. (MSSIDC) spearheads development in small industries.

(Credit: PhoenixD)

The government has launched numerous sector-specific policies to secure investments in certain sectors. The IT-ITeS Policy was launched last year with an aim to attract an investment of ₹95,000 crores and generate 35 lakh quality job opportunities. Several policies in logistics, textiles, and other industries are being revamped to strengthen the system.

The Maharashtra State Innovative Startup Policy is worth noting here, which is designed to foster a thriving startup culture in the state.

Overall, for the past several years, Maharashtra has remained committed to maintaining a business-friendly environment. And given its continuous efforts, more foreign investments are expected to come in the future.