By Naraway
In this article
"India vs Vietnam" is one of the most searched comparisons in manufacturing, usually followed by "economy" or "manufacturing". The latest full-year numbers from each country answer part of it and quietly mislead on the rest.
What Each Number Measures
| India | Vietnam | |
|---|---|---|
| Period | Financial year, April to March | Calendar year |
| Headline measure | Gross inflows; equity separately | Registered (pledged) and disbursed (actual) |
| Largest destination | Software and hardware, US$13.9 bn equity | Manufacturing and processing, 59.2% of registered |
| Top new-investment source | Singapore, US$19.8 bn | Singapore, US$4.84 bn |
Sources: DPIIT via India Briefing; Vietnam GSO and FIA via Vietstock and The Investor.
Vietnam's FDI is concentrated in factories; India's is spread across software, services and manufacturing. In Vietnam, analysts note growth now comes more from expansions and share acquisitions than from new projects: newly licensed capital fell 12.2% in value in 2025 even as project numbers rose 20.1%.
The Electronics Test
Electronics is where the two compete most directly. India exported a record ₹2 lakh crore of iPhones in FY26, its largest branded export, from five factories run by Tata and Foxconn, and its PLI schemes had paid ₹19,091 crore to large-scale electronics makers by June 2026.
The Difference That Is Not in FDI Tables
A factory in Vietnam is built mainly to export. A factory in India can also sell at home, into a market with 1.11 billion internet subscriptions, US$65-66 billion of online retail and 7% projected growth. That is why the comparison changes depending on whether the product is meant for India or only made there.
Part of Naraway's research series India Market Entry in 2026.
In short
Vietnam recorded US$38.42 billion of registered and US$27.62 billion of disbursed foreign direct investment in 2025, the highest disbursement in five years, with manufacturing and processing taking 59.2% of new and additional registered capital. India recorded US$94.53 billion of gross FDI and US$58.85 billion of FDI equity in FY 2025-26, led by software and hardware. Singapore was the largest source of new investment in both. The figures are measured differently and over different periods, so they show scale and direction rather than a like-for-like ranking.
- Vietnam 2025: US$38.42 billion registered, US$27.62 billion disbursed FDI.
- India FY26: US$94.53 billion gross FDI, US$58.85 billion equity.
- Vietnam: 59.2% of new and additional registered capital went to manufacturing.
- India: software and hardware drew the most equity, US$13.9 billion.
- Singapore was the top source of new investment in both countries.
Sources
- FDI inflows reach $38.42 billion in 2025, Vietstock
- Vietnam's 2025 FDI disbursement hits 5-year high, The Investor
- India FDI Report FY 2025-26, India Briefing
- Apple iPhone exports hit record Rs 2 lakh crore in FY26, IANS
- Summary of FDI situation in Vietnam in 2025 and outlook for 2026, B-Company
Frequently Asked Questions
Does India or Vietnam attract more FDI?
India in absolute terms: US$94.53 billion gross FDI in FY 2025-26 against Vietnam's US$27.62 billion disbursed in 2025. Vietnam receives far more relative to the size of its economy.
Where does Vietnam's FDI go?
Mostly manufacturing: 59.2% of new and additional registered capital in 2025 went to manufacturing and processing.
Where does India's FDI go?
Computer software and hardware drew the most equity in FY26, US$13.9 billion, followed by services and manufacturing sectors.
Which country is the biggest investor in India and Vietnam?
Singapore was the largest source of FDI equity in India in FY26 (US$19.8 billion) and the largest investor in new projects in Vietnam in 2025 (US$4.84 billion).
Why are India's and Vietnam's FDI figures hard to compare?
India reports by financial year (April-March) and separates gross inflows from equity; Vietnam reports registered and disbursed capital by calendar year.
