DETERMINANTS OF FDI PATTERNS IN INDIA: A CASE STUDY OF POLITICAL ORIENTATION

Foreign Direct Investment is the key factor for development of every country. It is a developmental tool which helps for accelerating growth in number of countries. Foreign Direct Investment helps a country in numerous ways to grow like by raising productivity, improvement in infrastructure, increasing employment opportunities and also develop competitive nature in domestic industries. In every five years, new government came up with new ideas, strategies and policies to grab higher investment in the country. There can be many factors which affect the inflows of investment in a country like inflation rate, interest rate, policies of the government etc. Since 1991, with the introduction of LPG policies there is huge increase in the growth rate of India in almost every sector. This paper seeks to provide a rationale for changing of trend in inflow of foreign direct investment during the period of 2013-17. The study examines five sectors that are financial services, insurance, real estate, manufacturing and education, research and development. The study is based on secondary sources of data. The paper then provides empirical support to identify the variables which cause high or low inflow of foreign direct investment in the specific period in India.