Determinants of foreign direct investment in India: An evaluate study

Globalization accentuates the increasing importance of the international economy for developing countries. Flows of finance, information, skills, technology, goods and services between countries are increasing rapidly. Foreign Direct Investment (FDI) is a pivotal instrument for economic development and bridging the gap between developing and developed nations. Capital flows in the form of FDI flows have been widely believed to be an important source of growth in recent year. India makes an increasingly significant use of Foreign Direct Investment, which works as a volatile source of finance in different sectors (Reenu and Anil Kumar Sharma, 2015) such as infrastructure, telecommunication, power, insurance, airports, and road modernization for the improvement of these sectors. For this reason, foreign investors want to know which sectors are more attracted to FDI and what are the inflows are invested in these sectors. This paper is organized as follows: Section I provides a literature review on the determinants of FDI inflow and its distribution on a conceptual and empirical basis. Section II presents sector wise distribution of FDI in India. Section III discusses the trends of country wise FDI inflows. Section IV describes the route wise FDI inflows in India prudence. This paper is purely based on secondary data.