A STUDY OF GLOBAL VALUE CHAINS IN FOREIGN DIRECT INVESTMENT IN INDIAN ECONOMY
Keywords:
Foreign Direct Investment, India, economic development, foreign companies, Indian businessesAbstract
Foreign direct investment (FDI) in India is a major monetary source for economic development in India. In 2019, worldwide FDI flows 1 grew 12 percent to USD 1,426 billion compared to 2018. However, flows remained extremely low in 2019, which accounted for only 1.6 percent of GDP from 2015 to 2017 compared with more than 2 percent since the 2018 FDI reform was very low. FDI flows were lower in 2018 and 2019, as flows fell in the aftermath of the 2008 global financial crisis, than they did at any time since 2010. This newsletter focuses mainly on FDI status in 2019 before many economies began to suffer from the COVID-19 virus. Section 4 and a separate notice on COVID-19 impact on FDI flows provide further information on current FDI flows and projections by the end of2021.Foreign companies directly invest in rapidly expanding Indian private enterprises to benefit India from cheaper salaries and changing business environments. Economic freedom started in India, and since then, in India, FDI has steadily grown, creating over one crore (10 million) in jobs in the future. On 17 April 2020, the Department of Promotion of Industry and Internal Trade announced that India had revised its strategy for FDI to shield Indian companies from "opportunistic takeovers of Indian companies by virtue of the new COVID-19 pandemic." Although the new FDI Policy does not restrict markets, the Policy ensures that the Ministry of Commerce and Industry now scrutinizes all FDIs.
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