Foreign Direct Investment in India Determinants and Its Impact

Abstract

Foreign direct investment acts as a catalyst for domestic industrial development, newlinespeeds the economic activities, augments the domestic savings, accelerates economic newlinegrowth and brings socio-economic prosperity by making contribution to the newlinedevelopment through the transfers of financial resources, technology, innovations and newlineimproved management techniques. There are several factors which influence FDI flows newlinein India. This exploratory research attempts to fill a gap in existing knowledge by newlineidentifying the determinants of Foreign Direct Investment (FDI) inflows in India. In newlinedoing so, it differentiates itself from previous studies on India and the vast body of newlineliterature on the empirical determinants of FDI in general, which uses country as a unit newlineof analysis. National level studies in general have ignored intra-national differences, newlinewhich are quite extreme in country like India.