FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH IN INDIA

Abstract

In this project, it has been tried to provide a comprehensive picture about the Foreign Direct Investment (FDI) And Economic Growth in India ranging from its conception as a potent source of investment the world over, its various types, the methodology adopted, top FDI countries and agencies engaged, and other key aspects. A cumulative and thorough study of the overall scenario of FDI in India; starting from the introduction of FDI in the country, the share of top investing countries and sectors attracting the highest FDI flows. We will also step in the determinants for attracting FDI in the country and the causes for the low flow of FDI and the mechanisms that can be undertaken to boost the nation attractive enough for investors. This research entirely relies on secondary data collected after a thorough and exhaustive study of various websites, textbooks, journals, newspapers, magazines, and great contributions of professors and professionals specializing in this field. The regression result indicates that FDI is positively correlated to the economic growth of India, though it has not been established as a significant determining factor for economic growth yet. The objective of this Research Paper is to realize the conceptual background, its necessity and impact on the Indian economy, determinations for attracting FDI, equity inflows in the various states, the pattern of FDI inflows in different sectors, and causes for low FDI inflow within the country. Finding shows there is high Variation in the inflows of FDI equity. The results also revealed that maximum contribution (28%) of FDI inflows in the service sector and Maharashtra, Dadra, Nagar, Haveli, Daman & Diu got the highest inflows which are 32% of the total FDI. This study will help the government to make vigilant planning to manage & boost foreign direct investment.