FOREIGN DIRECT INVESTMENT (FDI)

INTRODUCTION: 

SPEECH BY PROMINENT PERSONALITIES (PM, PRESIDENT, UN OFFICIAL et. al)/RECOGNITION IF ANY:

PM MODI

• FDI is a responsibility for Indians & an opportunity for the World. For the people of India, it means 'First Develop India'.
• FDI is a testament to global trust in India's growth story.
• We welcome foreign investors with open arms, as partners in India's journey towards prosperity and progress.

CURRENT DEVELOPMENT: 

• Ministry of New & Renewable Energy (MNRE) has issued an order to set up a project development cell to attract investment in renewable energy.
• National E-Commerce Policy to encourage FDI in marketplace model of e-commerce.

DATA/FACT:

KEYWORDS:

• BODY: Bright spot in the global economy; 4 ‘I’s of investment (Infrastructure, Integrity, Inclusive Development and International Outlook); Engine/Chariot of Growth; 
• CONCLUSION: From International Funding to Economic Partnership; Triveni: Demography, Democracy and Diversity; Naya Bharat, Naye Avsar, Nayi Samridhi (New India, New Opportunities, New Prosperity)

COMMITTEES RECOMMENDATIONS/NATIONAL OR INTERNATIONAL REPORTS:

• Aravind Mayaram committee: it recommended simplifying and rationalizing FDI regulations, streamlining sectors, and raising sectoral caps to promote ease of doing business and attract investments.
• Niti Ayog panel: Advised easing FDI norms, promoting strategic sectors, improving investment climate, simplifying approval processes, and enhancing transparency to attract FDI and foster economic growth.

GOVT SCHEMES, POLICIES AND INITIATIVE:

• To ease Investment: Foreign Investment Facilitation Portal; Empowered Group of Secretaries (EGoS); Project Development Cells (PDCs), National Single Window System (NSWS)
• To Boost FDI in Manufacturing: FDI Make in India; PLI Scheme; National technical Textile Mission, 
• National Digital Communications Policy, 2018 with a target of increasing FDI inflows in telecommunications sector
• Other initiatives: PM Gati Shakti, single window clearance, reducing corporate tax rates, enhancing the ease of doing business, and implementing reforms in the FDI policy and the establishment of a GIS-mapped land bank.

EXAMPLES/CASE STUDIES:

National

• FDI spurred India's IT boom, auto manufacturing hub, and modernized retail sector, stimulating economic growth, employment, and innovation.

International

• China's open-door policy: FDI-driven shift: agrarian to global manufacturing dominance via open-door policy.
• New Zealand (Regulatory Ease): Efficient business registration process has positively impacted its FDI attractiveness. 

CONCLUSION

• Amidst world's gaze on India's FDI potential, now's the time to accelerate ‘structural reforms.’ This ‘turbocharges FDI inflow,’ maximizing the chance to harness unparalleled growth prospects.
• The Government of India has established an ‘open & transparent FDI policy,’ granting automatic entry to numerous sectors. This approach fosters a liberal environment for foreign investors seeking business opportunities in India.
• With the active implementation of EoDB initiatives and the NSWS portal for approvals, and with a skilled workforce, digitisation, the robust legal system and a competitive tax system, India is set to become a major global hub for FDI.