Impact of Foreign Direct Investment on Industrial Growth of India

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Introduction : In India the Foreign direct investment (FDI) has received a staged improvement from instigate of the Make in India scheme, according to recent survey. There was a incredible increase in FDI inflows (40%) particularly in manufacturing sector from October, 2014 to June, 2019.

Status Of Industry Sector in  India:

  • The industrial sector is considered to be the one of the dominant sectors that contribute the major Indian GDP.
  • . India has been ranked fourteenth in the factory output in the world
  • Employment contribution 
  • The Index of Industrial Production (IIP) is considered to be an indicators which shows the flow of FDI in industrial sector and it is a crucial measure to see the industrial output of country. 
Positive Impacts :

1) Absorptive Capability One of the determinants of FDI impact on domestic firms’ productivity is their absorptive capability. Thus, firms with greater absorptive capability may benefit from greater spillovers. One of the indicators used to measure the absorptive capability of domestic enterprises is the availability of high-level human skills and education.

2)Technology: The technological gap between the origin country of FDI and the host country closely determines the extent of the technology transfer process

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Negative Impacts :

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Government Initiatives :

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way forward:

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conclusion :



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