It took nearly a decade before my parents made their first trip back to India after emigrating to America in the late 1960s. At the time, travel costs were prohibitive—and explaining India to others was a challenge. Today, flying directly from New York to India feels as routine as taking the Amtrak from New York to Washington, D.C. and business trips around the world begin on a Monday and conclude by Friday. This week, I found myself in Abu Dhabi among global investors—including many fellow New Yorkers—to explore untapped investment opportunities. The India investment narrative remains both familiar and multi-dimensional, varying by perspective and geography.
What is the India story?
This is a question I have posed to panelists on India-centric discussions across the globe: at the Milken Global Summit in Los Angeles, the Asia Summit in Singapore, and most recently, at the Middle East and Africa Summit in Abu Dhabi. These events attract the investment community and key stakeholders worldwide.
From Singapore, India is viewed as a gateway, with Singaporean investments totaling $150 billion and plans for further investments in the next five years. Recently, Singapore signed MOUs with India, focusing on the semiconductor industry to bolster talent and supply chains. From the Middle East, the UAE ranks as the seventh-largest investor in India, with $19 billion invested. Sovereign wealth funds, such as Mubadala, are directing investments into sectors like healthcare and infrastructure.
Historic ties, cultural familiarity, and trust underpin long-term investment growth. The India-Middle East-Europe Corridor (IMEC), announced at the 2023 G20 meeting in India, exemplifies this. The UAE and Saudi Arabia envision it as a bridge connecting East and West, counterbalancing China’s influence.
Outgoing U.S. Ambassador to India and former Los Angeles Mayor Eric Garcetti often cites a poll stating, “Indians love Americans more than Americans love each other.” He believes that India’s soft power lies in its people-to-people connections. The U.S. hosts the world’s largest Indian diaspora and is the top destination for Indian students pursuing higher education. India ranks second in visa issuance to Americans and houses the second-largest U.S. diplomatic mission globally, after Mexico.
As Garcetti’s tenure in India concludes, he echoes President Joe Biden’s sentiment that the U.S.-India relationship is the world’s “most consequential relationship.” This partnership is poised to deepen as global cooperation becomes imperative for tackling challenges like climate change and conflict resolution in an interdependent world.
Strategic partnership—and patience
Garcetti highlights that 10% of U.S. investments are in India, emphasizing India’s efforts to reduce investment barriers. With a 7% growth rate, India is the world’s fifth-largest economy, on track to become the third-largest, and potentially the largest by the end of this century. However, realizing this vision requires patience. “India is a long-term game,” driven by its demographic advantages, Garcetti notes.
The global “China plus one” strategy also positions India as an alternative in critical sectors like medical technologies, manufacturing, and green energy. According to Garcetti, the strategy is less about opposing China and more about diversifying supply chains.
“The U.S.-India relationship,” he asserts, “is one of deep friendship. It’s a place where, on critical technologies like AI, quantum computing, semiconductors, space, and biotech, we are sharing our deepest innovations in research and development.”
India’s investments in the U.S.
India emerged as the largest investor in the U.S. at the SelectUSA summit, hosted by the U.S. Chamber of Commerce. Significant investments, such as JSW Steel’s plans for wind turbine manufacturing in Texas, underscore this trend. Indian companies are also investing in Minnesota, Ohio, New Jersey, and California. In total, India’s foreign direct investment (FDI) in the U.S. reached $4.6 billion in 2023, reflecting year-over-year growth.
Garcetti envisions India as one of the top three FDI investors in the U.S. within the next decade, contributing significantly to job creation.
FDI supports nearly 8 million U.S. jobs, with pharmaceutical manufacturing accounting for the largest share of new investments. California and Texas lead in FDI inflows, totaling $29 million and $20.7 million, respectively, in 2022. While FDI inflows from traditional sources like Japan, Canada, and the U.K. have slowed, emerging economies such as India, China, and Brazil are making notable investments.
The evolving U.S.-India partnership holds immense promise for addressing global challenges and fostering economic growth. As investment flows and strategic alliances deepen, this bilateral relationship is positioned to shape the future of a multi-polar world.
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