FDIs and the growth of real economy

It is well evinced that the macro economic implications of the capital inflows into any country will have multiple facets in both short and long run periods, from which, Indian Economy is by no means an exemption. Indeed, chronic supply side problems of macro economy can be effectively trounced when capital formation is sterling in the real sector of the country, which in turn can capsize the odds of other four sectors of the country. It is reckoned to be the reason why the nesters of Indian Economy have been favoring the structural adjustment measures in the form of Foreign Direct Investments (FDI) and Foreign Institutional Investments (FII). More often than not, FDIs are bolstered comparing to the FIIs for not creating the bubbles of hot money and for proliferating growth rate in long run. But how far, this bolstering holds sway in the context of real economy of India need to be scrutinized before endorsing any corroboration to the policy decisions of enhancing FDIs in India. It is the reason why a research paper titled “FDIs and the Growth of Real Economy” is proposed with the following two objectives.

To analyze the trends of FDIs in India

To study the impact of FDIs on the growth of real economy