Now that is a huge number, but if you look at the potential rewards, they are even bigger. So in a way, it's not just about lifting millions of people out of poverty alone, it is also about unlocking many opportunities that could benefit the entire globe altogether. Let's then move on to the second story of the day and talk about what's exactly happening with India's foreign direct investments. Recently, India's FDI or foreign direct investments crossed a very interesting milestone. Since April of the year 2000, our country has attracted a total of 1 trillion US dollars in foreign direct investments. At a first glance, this seems like a massive achievement for sure. A trillion dollars flowing into support or establish businesses in India sounds like a huge win for our economy. But the question is, what does this number really mean for us? Where is this money even coming from? And where is it exactly going? And more importantly, is it exactly enough to meet the needs for a growing economy like ours in India? Now to make sense of all of this, let me take a step back and take a look at how foreign investments in India have evolved over time. Look, before independence in 1947, foreign investments were heavily concentrated in industries like tea, railways and mining. These investments mostly served colonial interests and enriched the British rather than benefiting our country. But after independence, our country adopted some socialist policies, which included stricter limits on foreign ownership. By the 1970s, foreign companies were only allowed to hold up to 40% equity in Indian businesses. This discouraged many global players and led companies like IBM and Coca-Cola to exit the Indian market altogether. But things here changed dramatically in the year 1991. Our country faced a severe balance of payments crisis, which essentially means that our country was running out of money to pay for our imports. This forced our government to open up the economy to foreign investments immediately. And for the first time, 100% foreign ownership was allowed in certain sectors and global companies began to take notice of it. Over the years, sectors like automobiles, telecom and consumer goods saw a significant amount of foreign interest. This trend continued to improve after the year 2000 and from 2014 onwards, the FDI rules were further relaxed under the current government. Campaigns like Make in India and Digital India also played a massive role in attracting global investments into the country. And interestingly, about 70% of India's total FDI inflow since the year 2000 came after the year of 2014. Now I know this sounds like a great story so far. Money coming into the country is great news, right? But let me tell you, it's not entirely the case. The headline figure of 1 trillion US dollar does not tell you the whole story exactly. While gross inflows have grown for sure, the amount of money flowing out of the country has also increased. This means that the net FDI, which is the money that actually stays in India, is not as impressive as it might seem at first glance. In addition to this, when you compare FDI to the size of the Indian economy, the numbers are even less interesting. Today, FDI accounts for just 1.1% of India's nominal GDP, which is one of the lowest ratios in the past one decade. Now, as India's economy grows larger over time, it still is not attracting enough foreign investments in order to keep pace with that growth level. And while this is not necessarily a very bad thing, it is still worth keeping an eye on as an investor. Now another issue like I mentioned is where exactly this investment is going within India. See geographically it is highly concentrated. Three states, Maharashtra, Karnataka and Gujarat collectively attract over 70% of FDI inflows. This leaves the rest of the country with just 30% and it creates a very uneven distribution of all these benefits. But on a brighter side, when it comes to sectors, FDI is a lot more balanced. Investments are spread across services, software, trading, telecom and manufacturing as well. And with that, let's move on and talk about where exactly this money is coming in from. See, globally, the biggest sources of FDI include the United States, the Netherlands and China. But in India's case, two countries dominate here, Mauritius and Singapore. Together, they account for nearly half of all FDI flows into India. And this is not just because Mauritius and Singapore have large economies themselves, Mauritius is actually known as a tax haven. This means it is often used as a channel for investments originating from other countries. And talking about Singapore, their sovereign wealth funds show genuine interest in India's potential. But surprisingly, China, which is the third largest source of FDI globally, ranks a distant 22nd in India. It just contributes 0.37% to India's total FDI equity inflows. The question here of course is why is China so behind in the list? The answer lies in trust and geopolitics for obvious reasons. See, India and China have a very complicated relationship like most of you might know by now. While we are major trading partners, we also have our share of conflicts. In 2020, after the clashes at the border, India became particularly more cautious about Chinese investments. The government introduced a press note 3 which required a government approval for any investment that came from countries that share land border with India. And this rule effectively slowed down Chinese FDI. In addition to this, India also started to scrutinize Chinese companies a lot more closely and banned hundreds of Chinese apps and kept a watchful eye on sectors like 5G and consumer electronics. And this cautious approach is also rooted in security concerns. See, no country wants foreign investors it does not fully trust to control critical sectors of its own economy. But the thing is, this approach may need some rethinking to be honest. Countries like Vietnam and South Korea have found good ways to balance their relationships with China. They have managed to benefit from Chinese investments while also diversifying their supply chains and reducing over-dependence on the country. By allowing Chinese capital into selected industries, they have managed to boost their exports and have also integrated themselves into global supply chains very very efficiently. Now for India, this entire situation is a very interesting challenge and an opportunity. See, if India truly wants to become a manufacturing powerhouse and we want to fully leverage the China plus one strategy, which is where companies look to reduce their dependence on China by investing in other countries, we might need to rethink our stance on Chinese FDI. See, currently in India, we rely very heavily on Chinese imports, but we don't add much value to these products before we export them again even further. Now, allowing more Chinese investments, especially in fields like renewable energy, semiconductors and heavy engineering could greatly help India build our own capabilities and reduce our trade deficit.