FOREIGN DIRECT INVESTMENT (FDI) IN INDIA

By :-

Navneet Chaudhary

Nikesh Biswal

Sagar Singh

Muttu Ayyanar

Jairaj Vaidya

INTRODUCTION

Foreign Direct Investment, or FDI, is acquisition of physical assets or capital in India. It leads to change in management, transfer of technology, increase in production etc.

It usually involves participation in management, joint venture, transfer of technology and expertise.

FDI can be classified:

Inward FDI and Outward FDI

FDI BENEFITS

Economic Growth

Trade

Employment and skill levels

Technology diffusion and knowledge

transfer

Linkages and spillover to

domestic firms

4

FDI APPROVAL PROCEDURE

Government Route for few sectors

Automatic Route in most Sector

RESERVE BANK OF INDIA

Foreign Investment Promotion Board

No permission required, only to notify RBI within 30 days of issue of shares to foreign investors

Approval is granted generally in 30 days

FDI INFLOWS IN INDIA

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

10,73318,65412,87110,06414,653

24,584

56,390

98,642

142,829

123,120

97,320

165,146

121,907

FDI Inflow in India (In Rs. Crore)

TOP INVESTING COUNTRIES

Mau

ritiu

s

Singa

pore

USA UK

Nether

lands

Japa

n

Cypru

s

Germ

any

UAE

Franc

e0

5000100001500020000250003000035000400004500050000

45241

9387 78455596 4282 3565 3527 2654 1476 1466

FDI INFLOW- SECTOR WISE

Service

Sec

tor

Constr

uctio

n Dev

elopm

ent

Teleco

mmunica

tion

Compu

ter S

oftw

are &

Hard

ware

Drugs

& P

harm

aceu

ticals

Chemica

ls

Automob

ile In

dustr

ies

Power

Meta

llurg

ical I

ndus

tries

Hotel &

Tou

rism

0

5000

10000

15000

20000

25000

30000

0

26306

7248

16542656

6011

1596

8384

2923

7878

17777

CONCLUSION

The increased flow of FDI in a country has given a major boost to the country's economy

FDI has provided better access to technologies for the local economy

FDI has lead to indirect productivity gains through spillovers

Multinational firms have increased the degree of competition in host-country markets which will force existing inefficient firms to invest more in physical or human capital

• Service sector has been the most sought after sector in India for Foreign Direct Investments

• India, with its skilled labor and manpower has the potential to overtake China as the most preferred destination for Foreign Investments

• Hence measures must be taken in order to ensure that the flow of FDI in our country continues to grow

THANK YOU