Do we in India have enough domestic savings to generate the mammoth capital we need to develop our infrastructure, to educate and create enough jobs for the masses, and to develop in-house technologies? The answer is a clear no and, hence, foreign direct investment (FDI) is needed to capitalise various sectors, as well as to bring in up-to-date technologies, networks, markets, process innovations and other best practices that enhance productivity of both foreign and domestic capital. As per Unctad’s World Investment Report, 2011, FDI into India has declined to $25 billion, a 31% slide, resulting in the country slipping six notches to the 14th spot in global ranking of countries that attracted highest foreign investment. While China has maintained its second spot with increase in FDI to $106 billion, i.e., 400% more than what India could manage, Brazil has raced ahead to the fifth position with $48 billion from its last 15th position and Belgium to the fourth position with $62 billion from its last 17th position, managing almost 160% FDI growth. FDI flows to Bangladesh have increased by 30% and, as some have already pointed out, in percentage terms, even Pakistan has performed better than India.
Source : http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETD/2011/09/10&PageLabel=11&EntityId=Ar01102&ViewMode=HTML
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