Asian Journal of Research in Business Economics and Management

For accelerating the pace of growth and development of a developing country, capital flows have become a necessity and, therefore, almost all the developing countries, have been trying hard to attract more capital flows. Further, these countries have rightly realized that assigning great role to private sector has become the need of the hour. Since the beginning of 1980s, capital flows to the developing countries have started gaining momentum and by the end of 1980s, there had been an enormous increase in the volume of capital flows to such countries. Though Government of India has always welcomed foreign investment with certain restrictions, the Government policy towards Foreign Investment has undergone remarkable changes, since independence, from time to time. Economic policy reforms have played a critical role in the performance of the Indian Economy since 1991. This study examines the relationship between GDP, Export, FOREX Reserves and FDI by using correlation and regression analyze. According to the results of the study, there is relationship between these variables in India. Significantly, India has become a safe avenue for Foreign Investment in almost all the sectors of the economy. Thus, FDI has helped in boosting our exports by modernizing and diversifying India's industrial structure.