Justification behind Foreign Direct Investment (FDI) in Indian Economy: A Re–look

Dr. Chitta Ranjan Pal

Volume : VI, Issue : IV, April - 2016

Justification behind Foreign Direct Investment (FDI) in Indian Economy: A Re–look

Dr. Chitta Ranjan Pal

Abstract :

According to IMF FDI is defined as “investment that is made to acquire a lasting interest in an enterprise operating in an economy other than that of the investor. The investors’ purpose being to have an effective voice in the management of the enterprise.” Developing countries like India are generally capital–scarce due to lower levels of income. It plays a vital role in development of an economy. FDI acts as a idge to fill the gap between investment and saving. Positive fundamentals combined with fast growing markets have made India an attractive destination for foreign investors. The present endeavour is an attempt to assess the present FDI status and sector–wise FDI attractiveness with effects of FDI including hindrances and concern.