An Analysis of Foreign Direct Investment with Special Reference to Indian Economy

Abstract

Foreign direct investment (FDI) has become the major stake for globalization of firms. It is belived that India’s generous and fast-growing native markets, well-synchronized and mounting financial markets, large density of population who speaks English, and its democratic government has created an eye-catching spot for investment. However India has not succeeded in captivating the FDIs to its potentiality. To brief, a few concerns include widespread corruption, multifaceted and prolonged investment procedures and business sanctions processes, old-fashioned way of land acquisitions, inflexible labor laws, and poor contract administration. To add to this, India’s GDP growth has slowed down for the past one year, and its large economic and current account deficits and persistent inflation increased the concerns. In view of the growing competition and to invite foreign direct investments (FDI), the present paper tries to evaluate the emerging trends and outlines of foreign direct investment in response to various policy measures broadcasted by the government of India.