Foreign Direct Investment in India: Emerging Horizon

It has been more than ten years since India embarked on a bold new policy on economic front. In these fourteen odd years there has been progress in both quantity and the way country attracted FDI. There has been a paradigm shift in the flow of FDI and consequent evolution of the country into a low c...

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Bibliographic Details
Published in:Indian economic review 2007-07, Vol.42 (2), p.255-266
Main Authors: ARCHANA, VANI, NAYAK, N. C., BASU, P.
Format: Article
Language:English
Subjects:
Chemicals industries
Corporate taxes
Economic models
Foreign direct investments
Foreign investments
Industrial policy
Investment horizon
Manufacturing industries
Software industry
Textile industry
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Summary:It has been more than ten years since India embarked on a bold new policy on economic front. In these fourteen odd years there has been progress in both quantity and the way country attracted FDI. There has been a paradigm shift in the flow of FDI and consequent evolution of the country into a low cost, high-tech, R&D intensive behemoth which can not only sustain R&D-intensive industries but also show significant growth in both quality and quantity. This paper intends to study this qualitative shift in the FDI inflow in India in-depth. It reveals that the country is not only cost-effective but also hot destination for R&D activities. Two models appropriate for the study have been made use of. While Panel Data model gives a holistic view, Seemingly Unrelated Regression (SUR) model gives a more detailed view of the changes taking place in the FDI space in India. Results are in conformity with changes taking place at ground level.
ISSN:0019-4670