A Critical Analysis of Fdi in India
Foreign Direct Investment: A Critical Analysis of FDI from 1991-2005
Kulwindar Singh Centre for Civil Society, New Delhi Research Internship Programme, 2005
Abstract
The Concept of Foreign Direct Investment is now a part of India’s economic future but the term remains vague to many, despite the profound effects on the economy. Despite the extensive studies on FDI, there has been little illumination forthcoming and it remains a contentious topic. The paper explores the uneven beginnings of FDI, in India and examines the developments (economic and political) relating to the trends in two sectors: Industry and Infrastructure and sub sector Telecom, to illustrate that.
Centre for Civil Society
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Table of Contents
Introduction Uneven Beginning Maintaining the Flow Another Beginning Sector Analysis Significant Change versus Struggling On Understanding FDI A Procedural Battle FDI Redux Sub sector: Telecommunications FDI Culture Conclusion Annexure Bibliography
3 4 8 9 10 10 12 13 15 15 16 19 20 23
Introduction
There is hardly a facet of the Indian psyche that the concept of ‘foreign’ has not permeated. This term, connoting modernization, international brands and acquisitions by MNCs in popular imagination, has acquired renewed significance after the reforms initiated by the
Centre for Civil Society
-2-
Indian Government in 1991. Contrary to the grand narrative ‘opening of flood-gates idea’ of 1991, what took place was a gradual process of changes in policies on investment in certain sub-sections of the Indian economy. As a result of controversy surrounding Foreign Direct Investment owing to a lack of understanding, it has become the eye of a political storm. The paper aims to present a unique understanding of FDI in the context of liberalisation and the prevailing political climate. FDI eludes definition owing to the presence of many authorities: Organisation for Economic Co-operation and Development (OCED), International Monetary Fund
Kulwindar Singh Centre for Civil Society, New Delhi Research Internship Programme, 2005
Abstract
The Concept of Foreign Direct Investment is now a part of India’s economic future but the term remains vague to many, despite the profound effects on the economy. Despite the extensive studies on FDI, there has been little illumination forthcoming and it remains a contentious topic. The paper explores the uneven beginnings of FDI, in India and examines the developments (economic and political) relating to the trends in two sectors: Industry and Infrastructure and sub sector Telecom, to illustrate that.
Centre for Civil Society
-1-
Table of Contents
Introduction Uneven Beginning Maintaining the Flow Another Beginning Sector Analysis Significant Change versus Struggling On Understanding FDI A Procedural Battle FDI Redux Sub sector: Telecommunications FDI Culture Conclusion Annexure Bibliography
3 4 8 9 10 10 12 13 15 15 16 19 20 23
Introduction
There is hardly a facet of the Indian psyche that the concept of ‘foreign’ has not permeated. This term, connoting modernization, international brands and acquisitions by MNCs in popular imagination, has acquired renewed significance after the reforms initiated by the
Centre for Civil Society
-2-
Indian Government in 1991. Contrary to the grand narrative ‘opening of flood-gates idea’ of 1991, what took place was a gradual process of changes in policies on investment in certain sub-sections of the Indian economy. As a result of controversy surrounding Foreign Direct Investment owing to a lack of understanding, it has become the eye of a political storm. The paper aims to present a unique understanding of FDI in the context of liberalisation and the prevailing political climate. FDI eludes definition owing to the presence of many authorities: Organisation for Economic Co-operation and Development (OCED), International Monetary Fund
Bibliography: Tharoor, Shashi. 1997. India: from midnight to the millennium. India: Penguin Books.