Determinants of Foreign Direct Investment in Indian Markets

ABSTRACT Today, India has come a long way since its Independence from the British Government in 1947. The current reform measures undertaken by the Indian Government and its constant effort to integrate the economy with the global market has led to rebirth of interest in FDI in India. The investment climate in the country is surely conducive to foreign investment. The policy liberalization in the country has led to the emergence of more inward foreign investment into the country. The main objective of this study is to analyze the influence that policies and procedures made by the government has on the FDI flows into India. The basic aim of the research is to know the extent to which the policies influence FDI in India. The study looks at the determinants of FDI in India. FDI has helped the economy to integrate with rest of the world. A qualitative research was undertaken for this study to evaluate the consequences of government policies related to FDI. The study also states the recent reform in the Indian market and what prevents it from being the number one recipient of FDI. The analysis indicates that government policies are an important determinant of FDI. Some recommendations are suggested in the end to help increase FDI flow into India