FDI inflows should recover soon

Concerns in some quarters over the slowdown in foreign direct investment (FDI) inflows in Q2 appear to be overdone. For a start, a smaller current account deficit means that India is now far less reliant on overseas borrowing to sustain domestic demand compared to recent years. And in any case, recent progress on economic reforms should help at the margin to boost FDI inflows over the coming months.

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