India’s Economic Development and The Role of Foreign Direct Investment: A Critical Evaluation

ABSTRACT

Foreign Direct Investment (FDI) is an investment made by foreign investors in a company headquartered in a foreign country. FDI has been a significant source of non-debt financing for India economic growth. Green Field Investment (where a new company is founded in a foreign country) and Portfolio Investment are the two primary forms of FDI (shares of a foreign company are purchased or ownership acquired in a foreign company). There are two routes to obtain investment approval in India: the automatic route, the RBI route, and the government route (also known as FIPB route). In recent years, the government has undertaken numerous steps, such as easing FDI regulations in defence, PSU oil refineries, and communications.

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