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FDI equity inflows rise 6% to $20 billion in Q1; US contribution drops, Japan tops

By Sohail Khan 26 September 2026, 9:58 am

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FDI equity inflows rise 6% to $20 billion in Q1; US contribution drops, Japan tops
Synopsis

Foreign direct investment equity inflows into India rose by 6% to nearly $19.81 billion in the first quarter. Japan emerged as the top investor while inflows from the US significantly decreased to $1.34 billion. The services sector received the highest investment, attracting around $7 billion during this period. Growing interest in AI personal assistants is prompting Indian tech companies to adjust their strategies accordingly.

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FDI equity inflows rise 6% to $20 billion in Q1; US contribution drops, Japan tops<br>

Foreign direct investment (FDI) equity inflows rose 6% to $19.81 billion in the fiscal first quarter with Japan being the top investor while that from the US fell, government data showed Friday.

Inflows including reinvested earnings totalled $30.6 billion in the three months ended June, according to data issued by the Department for Promotion of Industry and Internal Trade (DPIIT).

Equity inflows from Japan were $5.7 billion, Singapore $5.2 billion and Mauritius at $2.3 billion during the period. FDI from the US dipped by over 76% to $1.34 billion in April-June FY27 from $5.61 billion in the same period of 2025-26. Among sectors, services attracted the highest investment from overseas at $7 billion, followed by computer hardware and software at $2.8 billion.

Services sector includes financial, banking, insurance, non-financial / business, outsourcing, R&D, courier, tech testing and analysis.

Tamil Nadu was the top state receiving FDI of $5.9 billion.

ET Bureau

'Disruptive, But Opportunity Too'

While AI personal assistants have not yet become popular in India, preparations by Indian companies shifted into high gear after Meta's Muse became an overnight sensation in the US.

Muse, which can autonomously manage tasks from scheduling meetings to cancelling forgotten subscriptions on behalf of users, was the fastest growing app immediately after launch in the US, surpassing OpenAI's ChatGPT, SpaceXAI's Grok and Anthropic's Claude. The app was downloaded 902,000 times within six days of its September 8 launch, according to Sensor Tower data.

Although Muse is not available in India yet, the velocity with which it can scale with Meta's distribution muscle in a country with 958 million internet users has put tech leaders on alert.

Some Indian companies are already enabling agentic shopping on their platforms.

Zomato, the Eternal-owned food delivery platform, released an MCP (model context protocol) server that lets AI assistants discover restaurants, browse menus, build carts and place orders. Online travel agency MakeMyTrip announced a collaboration with OpenAI to allow travellers to book inside its Myra interface. Financial services firm Groww offers an MCP connection that lets users track and query their portfolio through AI tools.

Industry experts said the AI agents could help increase transactions but disrupt the direct app-consumer relationship, and platforms may have to amend the way they work to market products and ensure user stickiness.

"Agentic transactions can be both disruptive and opportunistic for consumer tech companies," said Ritika Rathi, executive director leading retail and consumer practice at PwC India. "Marketplaces may need to rethink commission sharing with sellers. They may have to retrain recommendation engines. The biggest shift will be advertising spends and services like push notifications, email, loyalty programmes, app engagement, to get consumers to return to their platforms."

Meesho sees agentic shopping as an opportunity and, to ensure security, has built a rate-limiting feature on its platform, said Kiran Kumar, head of platform engineering and AI at the ecommerce platform.

If an AI agent starts making thousands of product searches or requests per minute, Meesho can throttle or block those requests. This would help prevent excessive server load and automated abuse. Eternal, Amazon, Paytm, Groww and MakeMyTrip did not respond to ET's queries till press time Friday.

Cost, Security Concerns

AI assistants are seen as the next big battleground for leading labs. Gartner expects worldwide spending on AI assistants to grow from $16.5 billion in 2025 to $29.2 billion in 2026. JPMorgan forecasts that Meta's Muse could become the most-used AI app since ChatGPT.

Concerns over security have also increased, with AI agents such as Muse, Instinct, Grokbot (from SpaceXAI), OpenClaw and Hermes taking over consumer internet in the US, forcing technology giants to relook their policies and business strategies.

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