Impact of Foreign Direct Investment in Indian Economic Development
G. Uppili Srinivasan1, V. Anandavel2
1Dr. G. Uppili Srinivasan, Assistant Professor II, Exam Wing, SASTRA Deemed University, Thanjavur (Tamil Nadu), India.
2Dr. V. Anandavel, Assistant Professor, Department of Management Studies, Kongu Engineering College, Perundurai (Tamil Nadu), India.
Manuscript received on 18 September 2019 | Revised Manuscript received on 05 October 2019 | Manuscript Published on 11 October 2019 | PP: 210-213 | Volume-8 Issue-2S10 September 2019 | Retrieval Number: B10350982S1019/2019©BEIESP | DOI: 10.35940/ijrte.B1035.0982S1019
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© The Authors. Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: Foreign direct investment (FDI) is always shows good impact in the growth of Indian economy and Foreign Direct Investment is the wonderful weapon device in the hands of Government of India. Foreign Direct Investment (FDI) plays vital role in an Indian economy. The new economic policy of liberalization, privatization and globalization pointed out in 1991 induced the policy of foreign direct investment. Hence the foreign direct investment is an inevitable one in our economy. FDI plays a multifaceted role in the overall development of any economy. FDI is often preferred over Foreign Institutional Investments (FII) as it considered to be the most beneficial form of foreign investment in an economy. FDI plays a multifaceted role in the complete development of any economy. It provides a new source for capital, can lead to technological up gradation, skill enhancement and allocate efficiency effects. While FDI is forecast to create clear impact on the economy, it has also contributed in certain adverse impact on Indian economy during the past few years. The present study is organized to study the correlation and investigate the impact of FDI on Indian economy. The flow of FDI for the past 15 years was taken for study (2003-2018). The consequences were studied by testing the correlation with the country’s GDP and Stock Market Indices. Sensex and Nifty were calculated as the authenticated representative of Indian Stock Market. The study concludes that flow of FDI into the country plays a dominant role in deciding the stock market movements.
Keywords: FDI, Indian Economic Development, Sensex, Nifty.
Scope of the Article: Social Sciences