ROLE OF FOREIGN CAPITAL IN ECONOMIC DEVELOPMENT OF INDIA

Abstract

A foreign direct investment (FDI) is a controlling ownership in business enterprises in one country by an entity based in another country. In developing countries like India It is an opportunity to make the Economy in a balance Position or make if even better one. As it are playing as one of the growth engines of an economy. FDI is now considered as a creator of Wealth through its corporate sector and mobilize of much needed resources. It’s clear what India’s next step should be to achieve growth; make foreign direct investment (FDI) a top priority. However, India offers only a hesitant welcome to FDI. It seeks investments in several industries, including manufacturing, construction, telecommunications and financial services, but not in others the multi-brand retail. If the Indian government’s goal is to grow the economy faster, then it’s important to recognize the necessary of FDI. There is no point in being cagey in its efforts to attract FDI. The naysayers should recognize that FDI hadn’t harmed other countries that have attracted FDI, including Japan, South Korea, Mexico and China. For the last 10 years, global FDI net inflows have totaled nearly $15 trillion and even countries with populations that are fractions of India’s are making noticeable contribution to that figure. Brazil, with a population less than a fifth of India’s has seen $461 billion in FDI nee inflows in the last decade, while Turkey, nearly one 20th India’s size, has been $135 billion in FDI.