AUTONOMOUS

DEPARTMENT OF MANAGEMENT STUDIES

ASSIGNMENT-1

S. AKSHAYA
NAME OF THE STUDENT
S. JAYASHREE
M. CHELSIA BAGYAM
SIGNATURE OF FACULTY
310623631004
ROLL NO
310623631033
310623631014
YEAR AND SECTION I MBA ‘A’ SEC

SUBJECT CODE 233MBC101T

SUBJECT NAME ECONOMICS ANALYSIS FOR

BUSINESS
ASSIGNMENT TOPIC FDI IMPACT ON INDIA

DATE OF SUBMISSION 06/12/2023

TOTAL MARKS
 Journal-1
Impact of FDI on economic development of India
Author: GV Prasad, E Sharma

Published: 2012

Abstract
Once unlocking up of the Indian economy to the world economy, the
country witnessed crowd stream of foreign capital into the economy.
In the era of globalization foreign direct investment (FDI) takes vital
part in the development of both developing and developed
countries. Foreign Development Investment (FDI) offers a no. of
profits like overture of new technology, innovative products,
extension of new markets, introduction of new skills etc., which
reflect in the growth of Nation's Income. India is ranked as the most
favored end for foreign direct investment showing a remarkable
growth rate year by year. This paper tries to analyze the trends of
flow of foreign direct investment in India and its impact on selected
economic indicators..
 Journal-2
Impact of exchange rate on FDI: A comparative study of
India and China
Author: VB Khandare

Published: 2016

Abstract

India and China are the emerging economies in the world. These two
countries have about 37.5 percent population of the World. This
study was conducted to examine the impact of exchange rate on
foreign direct investment in India and China. For analyzing impact of
exchange rate on FDI the correlation and regression analysis
techniques have been used. It observed that the during 1991 to 2014
foreign direct investment in India increased by 458.89 times in
absolute terms whereas, the FDI in China increased by 29.43 times in
absolute terms during the same period. The exchange rate shows the
2.68 times decrease in value of Indian rupee in terms of US dollar and
1.15 times decrease in Chinas Yuan in term of US dollar during the
study period. It is found that there is positive correlation between FDI
and exchange rate in India. For China the correlation between FDI
and exchange rate is negative. It is observed that one unit increase in
exchange rate will raise FDI by 0.605 units in India. In case of China
one unit increase in exchange rate will leads to decrease of FDI by
0.2503 units during the study period. The P value 0.0017 indicates
that the coefficient of exchange rate variable is highly significant with
FDI in case India. The P value 0.238 indicates that the exchange rate
variable does not exert significant influence of FDI in case of China.
 Journal-3
Scenario of FDI in India
Author: Gunjan Malhotra

Published: 2015

Abstract
This paper investigates FDI in India with comparison to China.
The comparison is done with help of 12 years FDI data of
India and China. China is chosen for a comparison with India
as China is one of the fastest emerging economies of the
world similar to India and one of the major competitors of
India in terms of FDI inflow It also analyzed sector wise
contribution of FDI in India. To study this correlation test is
run between FDI and GDP in India. The result of correlation
between the GDP and the FDI inflow shows that there is a
high level of dependency between

GDP growth and the FDI inflow in the economy.

 Journal-4
Impact of liberalization on FDI structure in India
Author: Gulshan Kumar, Neerja Dhingra

Published: 2011

Abstract
Direct investment across national borders is a distinct feature of
international economics, which has gained intense attention of all the
countries of the world recently. Foreign direct investment (FDI) is
deemed to be a growth catalyst since it is usually accompanied by
entrepreneurial, managerial and technical skills which are indispensable
for economic growth (Humphrey, 1960). Foreign direct investment is
one of the most strategic and vital tools for developing a country‟ s
competitiveness and efforts must be made to garner huge share of FDI in
the country (Badar, 2006). Going by this ideology FDI is being sought by
most of the developing countries of the world for promoting the cause
of economic development. India, without exception, as in case of other
developing countries, is eager to prompt her economic growth which
compels her to accept and seek assistance of foreign direct investment.
The country also became host to massive inflows of FDI during 1990s
and 2000s in concert with her efforts to create more favourable settings
for it through trade liberalization, market deregulation, privatization of
national ownerships and encouragement to regional integration.
Actually in the early 1980s, Indian government adopted a liberal policy
towards FDI, especially in high technology areas and exports and it was
then that FDI friendly environment was created. Again a host of
incentives, exemptions and relaxations in the degree of flexibility
concerning foreign ownership adopted during 1990s gave a major boost
to FDI inflows. During which not only the quantum of FDI to India
escalated but the sectoral composition of FDI also underwent
tremendous change
 Journal-5
Home country impact on Outward FDI from India
Author: Rishika Nayyar, Jaydeep Mukherjee

Published: 2020

Abstract

The altering policy environment in emerging markets and the surge

in their outward foreign direct investment (OFDI) calls for an
empirical investigation. Accordingly, this paper examines the effect
of home country macroeconomic conditions and Government
policies on the OFDI flows from India during the period 1984 to 2015.
Incorporating the structural breaks in the empirical model, results
indicate the existence of a long-run relationship between OFDI flows
and home country macroeconomic and Government policies.
Government policies
 Journal-6
Impact analysis of FDI on insurance sector in India
Author: Aamir Hasan

Published: 2015

Abstract

Parliament has passed Insurance Laws (Amendment) Bill, 2015. It

was first passed in Lok Sabha on 4 March 2015 and later in Rajya
Sabha on 12 March 2015, which will become an Act when the
President signs it. The amendment bill aims to bring improvements
and revisions in the existing laws relating to insurance business in
India. The bill also seeks to remove archaic provisions in previous
laws and incorporate modern day practices of insurance business
that are emerging in a changing dynamic environment, which also
includes private participation. It is expected that the foreign
investment would bring about20,000-25,000 crore in short funds.
The amendment bill hikes Foreign Direct Investment (FDI) cap in the
insurance sector to 49 percent from present 26 percent. The foreign
investment in insurance would be routed under foreign direct
investment, foreign portfolio investment, foreign venture capital
investment, depository receipts, and non resident indians. Insurance
companies are permitted to raise capital through instruments other
than equity shares. Instruments would be specified through separate
regulations by the Insurance Regulatory and Development Authority
of India (IRDA). However, the voting rights of shareholders are
restricted only to equity shares. Sale of shares over 1% of the total
equity share capital and purchase of shares resulting in total equity
share capital of more than 5%, requires the prior approval of the
IRDA.
 Journal-7
Impact of FDI in agriculture sector in India:
Opportunities and challenges
Author: G Nedumaran, M Manida

Published: 2019

Abstract
Foreign Direct Investment has a vital errand to do in the rustic part for the
Indian financial system. FDI is empowered in the cultivating section to improve
the idea of yields. In the Indian Economy the FDI inflows to the cultivating
portion since 2010–2018 there is an important perfection in the Agriculture
section. Agriculture is said to be the establishment of the nation and it
encompasses of 65% of the Indian people. Along these lines, the
methodologies are limited in gathering to the agriculture influences a people.
In order to forgo the poverty, government has upheld the FDI in Agricultural
part and it is most acclaimed way to deal with discard the dejection and longing
for. There is an emergency in agrarian part because of the colossal advances
and advances which are paid by the banks to the ranchers. The ongoing
patterns in the horticultural part have delineated a deceleration in the agrarian
development. FDI in Agricultural Sector is one of the copious walks in
improving bothers of Indian Farmers. For propelling cultivating improvement,
reducing poverty and hunger, and progressing environmental supportability,
country theory is crucial. FDI enthusiasm for agriculture requires a logically
point by point ask about. Both positive and negative impact should be eagerly
examination, with respect to Indian economy. In order to grow the lifestyle for
the people and to engage those to use for sound and reflex improvements it is
pivotal principal that, capital course of action ought to occur at a higher rate.
This paper attempts to consider the impact of FDI in India expressly in green
part and to examine the likelihood and confusions looked by the fragment in
pulling in the black out budgetary masters adjacent to the various exercises
taken by the administrationBased on the results and findings, suitable
suggestions and conclusions will be made for the further research.
 Journal-8
Trend of FDI in India and its impact on economic
growth
Author: VINAY KUMAR

Published: 2020

Abstract
Foreign investments are the indispensable factors that help in
boosting the growth of Indian economy. With the introduction of
liberalisation policy under the finance ministry of Dr. Manmohan
Singh in 1991 & with further few policy reforms, India has witnessed
a change in the flow and direction of foreign direct investment (FDI)
into the country. This paper has made an attempt to analyse the
trend of FDI flow into the country and to find the relation between
FDI, FII and GDP of the country. India has witnessed the increase in
the flow of FDI from US $4029 million in 2001-01, to US $36396
million on 2013. Furthermore India has witnessed a year-on-year
(yoy) growth of 24.2 per cent in FDI to touch US $3.95 billion in April-
May 2013 as against US $3.18 billion during the same period in 2012.
However, the analysis shows that the country is still far behind in
comparison to some of the developing countries like China. The
continuous upsurge in foreign direct investments (FDI), allowed
across the industries and sectors, has proven that foreign investors
have faith in the resilience of Indian markets. Furthermore, the study
indicates that flow of FDI and GDP are positively correlated with each
other and the country’s GDP is showing a positive movement with
flow of Foreign Direct Investment in India. The flow of FII and FDI also
shows the positive correlation with each other.
 Journal-9
FDI impact on employment generation and GDP growth
in India
Author: Ratan Kirti, Seema Prasad

Published: 2016

Abstract
In the era of homogenization of development all over the globe,
capital has become crucial aspect and major concern for countries,
especially for the developing ones. Foreign funds inflow has become
one of the major resources for this. Countries are in a constant race
to attract more of foreign fund inflows or foreign direct investment
(FDI). The objective of this paper is to study the impact of FDI in India
on the employment generation capacity and GDP growth it also tries
to correlate GDP growth with employment trends, it will go through
sector-wise inflow of FDI in India and analyze its ability to generate
employment and productivity in India.
 Journal-10
The effect of FDI on India and Chinese economy: A
comparative analysis
Author: Dr SR Keshava

Published: 2008

Abstract
India and China are the two emerging economic giants of the
developing world, both situated in Asia with 37% of world population
(Asian Development Outlook2005) and with more than 9% growth in
their respective GDP of their economies (World Development Report
2006). China got independence in 1949, after 2 years of India's
political Independence (1947), but today, China has surged far ahead
of India in socio-economic development indicators. The FDI in India is
just 3.4% of FDI flows as a percentage of Gross Fixed Capital
Formation in India by 2004 and 5.9% of FDI stocks as a percentage of
GDP by 2004, whereas in China it was 8.2% of FDI flows as a
percentage of Gross Fixed Capital Formation and 34.9% of FDI stocks
as a percentage of GDP during the same year
 Journal-11
Various countries foreign direct investment (FDI) in India and
its impact on (GDP) of India
Author: B China Venkata Lingaiah

Published: 2021

Abstract
This paper investigates the impact of foreign direct investment on
Gross Domestic Production (GDP) Of India. The objective of this
paper is to study the impact of FDI on GDP of India. It studies a long
run relationship between the foreign direct investment and gross
domestic production in India. This relationship is tested by applying
Regression model. The change in GDP is taken as dependent viable
and FDI taken as independent variable. This paper deals with the
country wise impact of FDI on GDP of India. In this paper the
researcher obtains eleven years data to analyses the impact. In this
paper the researcher mentioned top nine countries FDI in India and
this FDI taken as share in GDP of India, Total FDI inflows to India and
FDI taken as share in GDP of India.
In this paper the researcher evaluated the impact of FDI on GDP of
India through testing of regression analysis. For this regression
analysis GDP taken as dependent variable and FDI taken as
independent variable, for this regression analysis the researcher
taken twenty years data (1995-96 to 2015-16) as financial year wise.
The result shows that the overall model is significant. There is a
positive and significant impact of FDI on GDP of India.
 Journal-12
The impact of foreign direct investment on employment
opportunities
Author: Syed Zia Abbas Rizvi, Muhammad Nishat

Published: 2009

Abstract
Over the past two decades, the continent of Asia received a large
amount of FDI from developed regions. Additionally, in the Asia,
India and China received a major chunk of foreign direct investment
and FDI flows to Pakistan also increased significantly.Many studies
show that the inflow of FDI plays a significant role in generating
employment in host countries. The objective of this study is to
undertake an empirical study on creation of employment
opportunities by FDI during 1985-2008 in the Asian region. In this
regard, we have taken the sample of three countries i. e. Pakistan,
India and China from the same region. The Im-Pesaran-Shin (IPS) test
of unit root is applied to find out the order of integration. The long
run relationship is investigated through the Pedroni (1999) test of
panel cointegration. At last, the Seemingly Unrelated Regression
(SUR) method is used for estimation of the impact of FDI inflows on
employment levels in three countries. Implications for FDI policy are
spelt out in the light of these empirical results.
 Journal-13
FDI in India-Its impact on entrepreneurial ventures in India
Author: Sabiha Fazalbhoy

Published: 2013

Abstract
This Paper intends to examine the impact of FDI in India on
Entrepreneurial Ventures, both existing and upcoming. As a part of
the Research Methodology, Data was gathered by a survey
conducted on two existing entrepreneurial firms and one upcoming
one, using a Questionnaire method. The Questionnaire was
composed of both factual and perceptional questions. Utilizing the
collected data this study shows that the sampled Entrepreneurial
firms are high on Innovation and thereby a hypothesis was made for
the same. The firms selected were based on their performance,
innovation, invention, risk taking factors. The conclusion establishes
a relationship between the government policies and the
performance of Entrepreneurial units. If the government policies are
framed to promote entrepreneurial ventures then the impact would
be positive, however if the government policies are more favorable
towards FDI then this would lead to tarnishing the upcoming
entrepreneurial ventures in the coming years, as the business giants
would absorb these new and tiny ventures and constrain their
development process. A recent article published in the Times of India
also states that the government must put a check and see the
constitutional validity of the centre’s decision to allow foreign direct
investment in multi brand retail.
 Journal-14
Impact of foreign direct investment on automobile sector
Author: K Maran, L Sujatha, TP Kumar

Published: 2017

Abstract

Indian economy seems to bear a down trend in its major economic

factors such as poor unemployment, low capital formulation, poor
standard of living, undergrowth in GDP, increased Trade deficit, low
infrastructural developments etc., In view of the economic crisis and
the shortage of capital, the Government of India realized the
importance of foreign capital for the development of the country.
The developing countries started opening their economy, out of the
compulsion, to achieve faster rate of economic growth and
development. Even a communist country like China adopted
liberalization policy as a strategy for accelerated economic growth
during 1979. India also joined the race by 1991. FDI inflows to
automobile sector have started pouring in since 2000. Owing to the
initiatives taken by the Government of India (GOI), there is a
tremendous change in the inflow of money in the Foreign Direct
Investment sector.
This study makes use of the published data from different sources,
which in research referred to as the secondary data. The growth of
FDI in the industry is forecasted for future period from 2010 to 2015.
The FDI inflow into automobile industry is increasing in position due
to huge demand in this sector.
 Journal-15
Impact of FDI & FII on Indian stock markets
Author: Sandeep Kapoor, Rcoky Sachan

Published: 2015

Abstract
Foreign investment was introduced in 1991 under Foreign Exchange
Management Act (FEMA). This step was taken to add some source of
capital formation in India as other developing economies were
already in this practice. As a result inflow of Foreign Capital has
become striking measure of economic development in both
developed and developing countries Now the developing countries
are witnessing changes in the composition of capital flows in their
economies because of the expansion and integration of the world
equity market. FDI and FII thus have become instruments of
international economic integration and stimulation. The Indian stock
markets are also experiencing this change. FDI & FII are becoming
important source of finance in developing countries including India.
It is widely assumed that FDI & FII along with some other external
factors such as global economic cues, Exchange rate and Internal
factors such as demand and supply, market capitalization, EPS
generally drive and dictates the Indian stock market. The current
paper makes an attempt to study the relationship and impact of FDI
& FII on Indian stock market using statistical measures correlation
and regression analysis. Sensex and CNX Nifty were considered as the
representative of stock market as they are the most popular Indian
stock market indices. Based on 10 years data starting from 2002 to
2011, it was found that the flow of FDI has no significant impact on
stock market but FII in India determines the trend of Indian stock
market.