06-09-2012, 01:34 PM
ROLE OF FDI IN INFRASTRUCTURE DEVELOPMENT IN INDIA
ABSTRACT
Inflow of Foreign Direct Investment (FDI) in the infrastructure sector has brought about a host of changes in the economy, including putting an end to a large number of government regulations and has given birth to innovative schemes of financing infrastructure projects. India is now the third most favoured destination for FDI, behind China and USA. In fact, UNCTAD has said that India is one among the dominant host countries for FDI in the Asia-Pacific region. Times have been really changing as far as this theme of foreign participation is concerned. However, all said and done, unless there are clear policy instructions with respect to the prioritizing of infrastructure projects and reform of the supportive institutional framework (basically the law and judiciary), invitation to any kind of capital, especially the one from foreign sources, will of no use. In this view, this paper endeavours to give an overview about the infrastructure development in India since the inception of the first five year plan. The paper in essence focuses on the role of FDI in the infrastructure development in India especially since the Liberalisation, Privatization and Globalization era. It also seeks to highlight the sectors in which FDI investments have taken place over the past decades and the changing pattern of FDI investments with respect to the sectors in which the investments are made. The study is broadly based on secondary data and the paper has its significance to the academicians, industrialists as well as to the policy makers.