New Delhi, Aug. 18 -- As the rupee depreciates, India's foreign investment numbers have come into the limelight. The focus has been net foreign direct investment (FDI), down from nearly $44 billion in 2020-21 to under $1 billion in 2024-25, even as gross inflows touched a record $94.5 billion.

Much of that gap is simply private equity and venture funds harvesting old investments through India's buoyant market for public share offerings.

Exits working as they should is not a crisis. The issue here, though, is a different one: focusing on FDI that matters.

India reports FDI as an undifferentiated number, lumping together a private-equity cheque that might go towards buying a promoter's stake in his company, say, with Foxconn investing to...