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Will FDI boost the economy of a country like India?

Asked by: akshatjaingolu
  • FDI Provides a Competitive Environment

    FDI is useful for our country in every sense for it will not only bring new infrastructure to our land but will also provide competitive environment. The wastage of agricultural produce can be hindered or atleast reduced. It will enable the farmers get better price for their crops. Overall the economy will rise as the consumers will get commodities at reduced prices.

  • It will help farmers.

    Allowing FDIs in the retail sector is beneficial as they would cut intermediaries between farmers, thereby helping them to profit more from their produce and helping them realise higher remuneration by selling their produce directly to large organisations and better rates. In labour intensive economies such as India’s, what we need to understand is that there isn’t enough reinforcement for farmers so as to sell their produce, rather farmers are driven toward subsistence instead of commercialisation, the opposite of which, is required for such an economy to actually grow.

  • Yes it helps

    The government's efforts to refine and liberalise norms for foreign direct investment (FDI) in India are useful and welcome steps in many ways. The central purpose of FDI, to introduce greater discipline to Indian sectors and permit consumers greater choice, is a valid and important goal. In addition, regulations continually need to be tweaked to ensure that the private sector, which is always more dynamic than regulators, does not get too far ahead in terms of exploiting any loopholes that may exist. This is why, for example, there was a need to revisit the definition of "control" of a company. What does it mean to say that a foreign entity has "control" of an India-based company? The current definition, that foreign entities should be able to appoint the majority of a company's directors on its board, could easily be worked around in practice. Justifiably, therefore, the government wants to tweak the definition of control, which is now proposed to be determined by shareholder agreements or lien over voting rights. An expanded definition will allow for better principles-based regulation.

  • FDI boosts economic growth

    The entry of foreign investments to a country like India would seemingly be positive.

    Firstly, as the amount of investments in the country grow, more job opportunities will follow as well. Unemployment would be lowered as there are more job openings for the unemployed.

    Secondly, from an Economics point of view, FDI is a key component to aggregate demand in a large-scale economy. A positive shift in the aggregate demand of a country would have a direct positive influence on the economic growth of the country.

    Last, but not least, as FDI enters the country, developments are bound to follow. For a country like India, which is developing, the entrance of foreign companies would result in technological advancements, alternative ways of managements, alternate mindsets etc., being brought into the country. This would help, in the long run, to transform a developing country into a developed one, by boosting its economy.

  • FDI paving the path of destruction of Indian Economy

    Its really amusing that still some people do believe that FDI will benefit India. No doubt it has harmed Indian Economy than it has benefited it. If FDI would have been absent in India then surely the indigenous industries of our country would have rose and would have been competing with the multinational companies of the world at present. Almost every good domestic country which had established ts roots in our market has been purchased by the MNCs and those who refused to sell their company have now emerged as marketing giants of India. And a no of examples could be sited to prove it. Also due to this FDI only, the money of Indians is going out and day by day these foreign companies are becoming richer and richer.

  • It cannot boost, it wil break

    The economy of india as the indian economy of india is based on medium and small scale workers and farmers. If FDI will come, the malls will try to remove the workers andwil buy the crops from the farmers in high price and sell it to the people in low price but afterward the FDI will spoil all, the farmers, the workers, and the people


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