A retrospective view of foreign direct investment in India

Poonam Bassi
Bhavna Sharma


It is the central issue in international business and in international economics to make global investment strategies. Capital formation is very essential for economic growth. Foreign direct investment (FDI) plays a complementary role in overall capital formation by satisfying the space between domestic savings and investment.Sometimes domestically existing wealth is insufficient for the purpose of overall development of the country. Foreign capital is seen as an approach of satisfying in gaps between household savings and investment. India can magnetize much larger foreign investments than it has done in the past. The present study has focused on the trends of FDI Flow in India during 2000-01 to 2014-15 (up to June, 2015). The study also highlights country wise contribution in foreign direct investment. The study is based on Secondary data which have been collected through reports of the Ministry of Commerce and Industry, Department of Industrial Promotion and Policy, Government of India, Reserve Bank of India, and World Investment Report. The study concludes that foreign direct investment plays a significant role on the growth of economy. It also concludes that FDI is available mostly in the developing countries.

Keywords: Keywords: Growth, capital formation, foreign direct investment, economy.

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