Foreign direct investment (FDI) inflows into India in the first five months of 2020-21 have hit a record high, despite a sharp 60% contraction in the first quarter, with July and August raking in over $20 billion of equity FDI. Total FDI inflows surged from $11.51 billion between April and June to $35.73 billion by the end of August. Equity FDI more than quadrupled from $6.5 billion between April and June, to $27.1 billion by August — 16% higher than the first five months of 2019-20. To put that in context, India received about $50 billion in equity FDI in 2019-20. Also read: India will continue to attract FDI, says U.N. trade bodyBoth, total FDI and equity FDI viewed in isolation, were the highest ever for the five month period, the Commerce and Industry Ministry said on Tuesday. The increased FDI is a result of FDI policy reforms, investment facilitation and ease of doing business, the Ministry said. Total FDI flows include fresh equity investments as well as re-invested earnings of foreign investors and other forms of investment capital such as debt. FDI equity flows were boosted by investments into Jio Platforms, Reliance Industries’ telecom subsidiary, from global investors like Google, that bet $4.5 billion on the venture in July. Also read: Government nod mandatory for FDI from neighbouring countriesBut this was not the only factor for the turnaround in FDI trends over two months, reckoned experts. “There has been a lot of quiet private equity investments taking place in the real estate sector, which are expected to continue. Moreover, several existing foreign investors have realised the need to ramp up local supply chains after the pandemic hit,” said Vikram Doshi, partner (tax and regulatory issues) at PwC. Also read: Govt’s decision on FDI in defence to enhance self-reliance in sector: GoyalMr. Doshi said the numbers would have been even higher if border tensions with China hadn’t triggered curbs on their investments into India. China has significant investments in Indian startups as well as the manufacturing sector, any enhancement of which would now need prior government approvals. Yet, the next few months could see a further spurt in FDI. Firstly, there’s Reliance Retail’s buyout of Future group at the end of August, which was followed by multiple global capital infusions into the business — similar to investments into Jio. Those foreign investors’ outlays will reflect in September’s data and beyond. Also read: Foreign Direct Investment equity inflows register negative growth in Tamil Nadu, says RBI dataSecondly, investments committed under the production-linked incentive (PLI) scheme for electronics manufacturing, from players such as Apple Inc’s suppliers, will begin to flow once approvals come in. Similar investments may be expected in pharma and chemicals under another PLI scheme. Foreign investors have also evinced interest in the government’s moves to allow private train operations and bid out airports. Big ticket sectors such as defence manufacturing where the government enhanced the FDI limit under the automatic route from 49% to 74% in May, could also attract large investments going forward.