Foreign Direct Investment for Developing Countries

Abstract

Foreign Direct Investment (FDI) has emerged as a crucial catalyst for India’s economic development, significantly shaping its growth trajectory. This paper examines FDI’s multifaceted dimensions and implications, highlighting its diverse relevance in fostering India’s economic progress. It delves into the mechanisms through which FDI inflows bolster export-led growth, facilitate knowledge transfer, drive job creation, and serve as a vital source of capital accumulation. Additionally, it evaluates the prospects and challenges associated with FDI in India, providing insights into policy implications and recommendations for optimising its potential impact on economic expansion. Through an in-depth analysis, this paper aims to offer a nuanced understanding of the role of FDI in India’s economic landscape and provide actionable insights for policymakers and stakeholders to harness its benefits effectively.