What is it about?
Foreign investment has become an important source of economic growth in developing countries like India. This study examines how two major forms of foreign investment—Foreign Direct Investment (FDI) and Foreign Institutional Investment (FII)—contribute to India's economic growth and sustainable development. Using long-term data from the World Development Indicators (WDI), the research analyzes the relationship between foreign investment and Gross Domestic Product (GDP). The study explores whether these investments have short-term or long-term effects on economic performance and how they support national development. The findings suggest that while both FDI and FII contribute positively to economic growth, they differ in their stability and long-term impact. The research provides useful evidence for policymakers, investors, researchers, and businesses seeking to understand how foreign capital can promote sustainable economic development in India.
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Why is it important?
At a time when countries are competing to attract global investment, understanding the role of foreign capital in economic growth is more important than ever. This study provides evidence on how FDI and FII influence India's GDP and contribute to sustainable development. By distinguishing the different impacts of long-term direct investment and short-term portfolio investment, the research offers valuable insights for policymakers, investors, and economists. The findings can help improve investment policies, strengthen economic planning, and support sustainable growth strategies that enhance India's long-term economic resilience.
Perspectives
As an author, I believe that foreign investment is more than a source of capital—it is a driver of innovation, employment, technology transfer, and sustainable economic development. Conducting this research reinforced my understanding that different forms of investment contribute to growth in different ways and therefore require balanced and well-designed policy approaches. I hope this study encourages policymakers, researchers, and investors to adopt evidence-based strategies that maximize the long-term benefits of foreign investment while promoting inclusive and sustainable economic development.
Dr. Sushanta Kumar Tarai
Kalinga Institute of Social Sciences (KISS) Deemed to be University
Read the Original
This page is a summary of: FDI and FII: Drivers of National Sustainability Growth in India, KISS International Journal of Entrepreneurship Innovation and Sustainability, July 2025, Kalinga Institute of Social Sciences (KISS) Deemed to be University,
DOI: 10.65901/kijeis.2025.v1i1.5-13.
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