As per the annual report published by the Reserve Bank of India, the foreign direct investment inflow has increased by 50% since last year. After Reliance Jio has entered the market in September 2016, the Indian telecom industry has been suffering tremendous loss. This is one of the main reasons that the foreign investors are interested to invest in the telecom industry of India.
Due to the huge market presence of Reliance Jio, some of the global telecom companies have quit their business in India. On the other hand, some of the small telecom companies have shut down their operation altogether. Docomo and Telenor are two of the global telecom companies that have left Indian market. Aircel has shut down its operations. Reliance Communication is going to face bankruptcy. Vodafone India and Idea Cellular have signed a merger. Thus, Airtel is the only competitor of Reliance Jio that is still able to secure the leading position.
Some of the companies are also trying to sell off their assets, which is also attracting the foreign investors. American Tower Corporation is one such foreign organization that has already increased its amount of investment in India. The USA-based tower company is about to buy 20,000 towers that were owned by Vodafone.
Brookfield, the Canadian group of companies was prepared to buy the towers that belonged to Reliance Communication, However, as the deal was not successful, the company is now looking for other companies that want to sell their towers.
Although the FDI growth in the year 2014 was 54%, by the end of 2017, the growth reduced to only 0.08%. Even in 2018, the growth rate has been 2.89%. As the developed countries do not offer an option for much growth, India, the developing country is the best bet for the investors. Besides, the emerging Indian economy and the slow price of oil also makes it easier for the foreign investors to gain huge profit.