Submitted to. Dr.Sugundan N.

Meaning of FDI
• Foreign direct investment (FDI) is an investment made by a company or an
individual in one country into business interests located in another country.
FDI is an important driver of economic growth.
Objective of FDI
• Sustaining a high level of investment
• Technological gap
• Exploitation of natural resources
• Undertaking the initial risk
• Development of basic economic infrastructure.
Advantages of FDI
• Economic growth.
• Technology
• Human capital development
• Exchange rate stability
• Creation of a competitive market
• Improved capital flow
• Increase in export
• Development of back ward area
Disadvantages of FDI
• Hindrance to Domestic Investment
• Risk from Political Changes.
• Negative Influence on Exchange Rates
• Higher Costs
• Economic Non-Viability
• Expropriation
FDI in India
• The investment climate in India has improved tremendously since 1991 when
the government opened up the economy and initiated the LPG strategies.
 FDI Routes in India

• There are three routes through which FDI flows into India. They are described
in the following table:
Category 1 Category 2

100% FDI permitted through Automatic Route Up to 100% FDI permitted through Government Route
The major sectors benefited from FDI in India are:

• Financial sector (banking and non-banking)

• Insurance
• Telecommunication
• Hospitality and tourism
• Pharmaceuticals and
• Software and information technology.
FDI is not permitted in the industrial sectors like ;

• Arms and ammunition

• Atomic energy,
• Railways
• Coal and lignite and
• Mining of iron, manganese, chrome, gypsum, sulphur, gold, diamonds, copper
etc.
 THANK YOU
• Submitted by: Abhismita Bhanja
Anwesha Das
Anita Mantri
D. Nikita
Ananya Swain
Bhagyashree Mohanty
Alisha Priyadarshini
Brajeswari Panda