In the current global economic situation, no country is self sufficient. Since Foreign Direct Investment (FDI) is a way of filling the gaps between domestic savings and investments, it is considered very essential for the development of a nation. Global investors and multinational companies have improved their outlook towards investment in India on seeing the liberalization of the FDI regime. According to UNCTAD’s 2021 World Investment Report, FDI inflows reached an all-time high of USD 64 billion in 2020, registering a 27% increase compared to USD 51 billion in 2019. India ranks 5th among the top 20 FDI host economies and the largest host in the sub-region; the country historically accounts for 70-80% of inflows into the region. During 2021, India has relaxed administrative regulations for foreign investors in some industrial sectors by abolishing the requirement for approval by the Reserve Bank of India under certain conditions. The overall growth of FDI in India is thanks to its many assets, especially its high degree of specialisation in services, with a skilled, English-speaking and inexpensive labour force and a potential market of one billion inhabitants. Singapore, Mauritius, the Netherlands, Japan, the U.S., the U.K., France and Germany are the main investing countries in India. Investments were mainly oriented towards services, computer software and hardware, telecommunications, trade, the automobile industry, construction and chemicals. The present paper attempts to portray the factors influencing FDI and the different sectors which are leading in FDI in India.