What is FDI ?
Foreign direct investment (FDI) is a
direct investment into production or
business in a country by an individual
or company in another country, either
by buying a company in the target
country or by expanding operations of
an existing business in that country.
When did this start in INDIA?
Foreign investment was introduced in
1991 under Foreign Exchange
Management Act (FEMA), driven by
then finance minister Manmohan
India disallowed overseas corporate
bodies (OCB) to invest in India.
Where does India stand?
India has been ranked at the second
place in global foreign direct
investments in 2010 and will continue
to remain among the top five attractive
destinations for international investors
during 2010-14 period.
From where are we getting
How has it been growing? - 2
Foreign direct investment (FDI) in
India has increased by about 35 per
cent to $13.6 billion during the first half
of 2013 with merger and acquisitions
accounting for the bulk of
inflows, according to a report by the
United Nations Conference on Trade
and Development (UNCTAD).
Why will India want to encourage
India now with consistent growth
performance and abundant highskilled affordable manpower provides
enormous opportunity for investment
both domestic and foreign. Foreign
direct investment (FDI) causes a flow
of money into the economies which
activity, increases employment and
induces the long run aggregate supply
and brings in best practices.
Why should India not encourage
Investment of a foreign company with its
new technologies and products has
several disadvantages for local
New products arriving at lower prices
create competition and force local
businesses to lower their prices and
reorganize their operations in terms of
Local businesses may lose their
customers or even their business
relations with other companies as they
start cooperating with the new foreign
Where are we heading?
In view of the above analysis, I believe that
India will be one of the most attractive
nation to invest in.
2008 2011 2013 2018