India is likely to receive new foreign direct investment (FDI) from Hong Kong for domains including tokenization, finance technology (fintech), and green finance. The special administrative region of China plans to utilize its capital-raising capabilities to support India’s digital transformation and sustainability targets, according to a report by The Economic Times. The alliance between the two Asian tech majors is also expected to attract Indian companies and skilled professionals to Hong Kong, thereby promoting mutual economic synergy.
“India has become an increasingly attractive destination for FDI in recent years, driven by its dynamic and evolving business ecosystem…In the next year, investments are likely to accelerate in these high-potential sectors, supported by Hong Kong’s robust capital raising ecosystem,” King Leung, global head of financial services, fintech and sustainability, at the Hong Kong investment promotion department, told the media outlet.
According to the report, Hong Kong is also aiming to attract the Indian skilled workforce and businesses to support its innovation drive in sectors such as fintech, digital technology, and artificial intelligence (AI) accelerators. Strong investment inflows from Hong Kong have diversified into sectors that support India’s expedited digital overhaul and sustainable development objectives, the report stated.
“The economic synergy between India and Hong Kong/Chinese Mainland has significantly contributed to this trend,” Leung said.
Due to India’s rapidly expanding digital economy, companies based in Hong Kong are associating with Indian startups to create business-to-business (B2B) solutions across banking, insurance, and wealth management.
According to Leung, interest in tokenized assets is increasing globally, and India is poised to benefit from Hong Kong’s established expertise in this area. Already, India’s financial capital—Mumbai—is promptly developing a framework for asset tokenization that could release around ₹50 trillion ($566 billion) in idle capital. Simultaneously, the Reserve Bank of India (RBI) revealed its intention to introduce tokenization for financial assets and settlements using its wholesale central bank digital currency (CBDC).
“Hong Kong’s financial and start-up ecosystem, which houses nearly 4,700 ventures across sectors like AI, healthtech, fintech, Web3, and other cutting-edge industries, presents significant opportunities for Indian startups and investors,” Leung informed.
Notably, startups are expected to contribute approximately $1 trillion to India’s economy by 2030, according to a white paper unveiled by consulting firm KPMG at the TiE Global Summit. India’s startup ecosystem, ranking third globally with over 100 unicorns, also offers rich investment opportunities for foreign investors. India’s transformation into a global hub for innovation and investment has significantly altered its entrepreneurial landscape, making it the world’s third-largest startup ecosystem, according to a KPMG report.
Green finance strengthens India-Hong Kong ties
At the same time, India’s sustainability goals closely align with Hong Kong’s strengths in green finance, which is significant since the Asian major is a global leader in green bonds and loans.
According to the report, Hong Kong accounts for about 45% of all green bonds and loans in the Asia-Pacific region, which presents significant opportunities for Indian companies looking to raise funds for fulfilling global sustainability standards, Leung added.
The Hong Kong government recently introduced its third digital green bond, worth about $1.3 billion, denominated in the HK dollar, the U.S. dollar, the euro, and the Chinese yuan. This new bond is the world’s first to enable investors to settle transactions using tokenized central bank money, promoting the first instance of incorporating CBDCs, specifically the digital yuan and the e-HKD.
“The integration of tokenised central bank money in this issuance lays the foundation for future integration with other forms of digital money, fostering interoperability and unlocking new synergies across different digital infrastructures,” said Eddie Yue, the CEO of the Hong Kong Monetary Authority.
Hong Kong, long seen as a “Gateway to China,” now holds the potential to become a “Gateway to India” due to the rising economic solidarity between India and China. According to an official statement, India’s merchandise exports to Hong Kong stood at approximately $6.07 billion in 2024-25, encompassing a range of products, from luxury items such as gems and jewellery to engineering and electronic goods. Merchandise exports to Hong Kong in April-August 2025 increased by 26.19% to $2.62 billion. Interestingly, re-export trade between India and China, through Hong Kong, amounted to about $12.59 billion in 2024. This highlights India’s increasing significance in global trade and the robustness of its export sectors.
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Hong Kong advances tokenization
Hong Kong is accelerating its efforts toward tokenization and has reportedly started the pilot stage of Project Ensemble, which will examine real-value transactions using tokenized deposits and digital assets. The pilot, set to run through 2026, will initially concentrate on tokenized money-market fund transactions as well as real-time liquidity and treasury management.
During this phase, interbank settlements are expected to be conducted through the HKD real-time gross settlement system. The Hong Kong Monetary Authority (HKMA) has indicated that the system will eventually be improved to allow round-the-clock settlements using tokenized central bank money.
“The integration of tokenised central bank money in this issuance lays the foundation for future integration with other forms of digital money, fostering interoperability and unlocking new synergies across different digital infrastructures,” added Yue.
According to a recent report by the Boston Consulting Group (BCG), the tokenization of real-world assets (RWAs) could reach a value of $23.4 trillion by 2033. Tokenized bonds and funds are expected to become core components of the industry, paving the way for sectors such as real estate, equities, alternative investments, and credit to emerge as major contributors. BCG anticipates that banks will represent more than one-third of all tokenized assets by the decade’s end, with their share climbing to over 50% by 2033.
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Watch: ‘Disruptive’ blockchain can be useful for India
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Source: https://coingeek.com/india-attracts-hk-investments-in-tokenization-fintech-report/
