The Impact of Foreign Direct Investment on Indian Economy

Globalisation of economic activities has increased the importance of multinational enterprises in the development process of a country. The inflow of Foreign Direct Investment (FDI) increased rapidly during the late 1980s and the 1990s in almost every region of the world revitalizing a contentious debate about the costs and benefits of FDI inflows. The reforms undertaken in India since 1991 have unleashed the potential growth of the economy and stimulated trade, outsourcing and the entry of multinational enterprises under the banner FDI. In recent years, India has become one of the attractive destinations for overseas investment as adduced by FDI inflow figures of India which have reached a historic high in recent years and is ranked 3rd among the most attractive locations for foreign investments by UNCTAD. The fact to be noted here is that a large amount of foreign direct investment has been chasing too few sectors like Computer Software & Hardware, Financial Services and Automobiles. This book discusses the wonders and the blunders of foreign direct investments in the post Liberalisation era in India. It also contains the contributions of foreign direct investment to India which require investments that will strengthen the infrastructure industries and services that are so essential for sustainable growth and also for the social well-being of the poor and marginalised.