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
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