KOCHI: Amid escalating trade disputes involving the US and China, India has seen a significant surge in foreign corporate investment from the international sector. A report by the American research firm Rhodium Group reveals that China's share of total foreign investment worldwide has plummeted to a mere 1% in the current year, down from 48% in 2018.

During this period, the combined share of India, Singapore, and Malaysia has risen from 10% to 38%.The trade tensions are largely related to disputes over semiconductor technology usage and concerns about espionage, sparking a trade war between China and the US. With the COVID-19 pandemic's impact, major corporations in the United States and Europe have grown increasingly doubtful about the reliability of China, which has also hurt foreign investment.

China's official figures, as per its foreign exchange reserves, indicate that direct industrial investment fell by $11.8 billion in the July-September period. Simultaneously, numerous established large companies are downsizing their operations in China. This is the first instance of a negative figure appearing in China's official data since 1998.

FDI in China has been on a steady decline since the imposition of stringent zero-COVID conditions in Shanghai in April-June 2022. In August, the US government issued strict directives to large corporate companies, discouraging investments in China, especially in sectors such as semiconductor chips and artificial intelligence (AI). In the following month, prominent companies, including Mitsubishi, announced their withdrawal of investments from China.

China's exports have also experienced a significant drop, declining by 14.5% in July. During the same period, imports fell by 12.5%. The global economic slowdown and trade disputes with Western countries are negatively impacting China's economic growth. In July, exports to its largest trading partner, the United States, fell by 23.4%. Sales to Europe also saw a drop of over 20%.