Why Has India Been So Popular For FDI?

Posted by Aravind Sreeharsha on January 28th, 2021

With the incidence of globalization, foreign direct investment (FDI) has become a topic of popular interest. FDI in mining in India has acquired an evidently critical role in the International Economy after the Second World War. They have unbolted new avenues for national markets which are now open to intercontinental business. Local marketplaces need to reconnoiter resources beyond boundaries to boost the incursion of funds and to increasingly obtain improved technology, boost their domestic rates and improve their economy. For the underdeveloped and developing countries FDI implies foreign exports and access to global markets and currencies.

The benefits of FDI are abundant. FDI brings with it lots of employment chances and technical competence. FDI also augments the competitiveness of local companies. It warrants flow of money to businesses across the nations that have decent growth prospects. It brings with it competitive benefits and diversity. The advantages for both investors and receivers are abundant. It has also been perceived that foreign direct investments have revitalized and supported countries during times of economic strife.

The 1997 Asian financial crisis for example, where other chief cash inflows suffered major setbacks, FDI was held steady. Transfer of resources in terms of capital and technical familiarity is another blessing. FDI opens up a catholic array of opportunities in trading of merchandises and services, holding good for both imports and exports. It plays a vital role in improving the production of the host countries. The quality of goods and services is also heightened as a result. Income via taxation on FDI also helps upsurge the revenue for the recipient countries Government.