Articles related to Impact of FDI

The inflow of FDI in the key industries of India

India highly depends on foreign investments in the form of foreign direct investments (FDI) to fund its economic growth (Demirhan & Masca, 2008). Amongst all the sectors, the manufacturing sector and service sector has undergone a transformation and experienced high growth rates in the past few years. However, from the data on FDI, it can be observed that few key industries belonging to these two sectors have boosted at a faster rate than the others and attracted more FDI than the others.

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Importance of environment in the CSR mandate of India

The previous article on making corporate social responsibility (CSR) mandatory mentioned that such a need arises due to the responsibility of profit-driven companies towards society including the environment. The CSR mandate caters to the strategies needed for building a cleaner environment. The importance of environment stems from its inclusion in the concept of sustainability as put forward by the Brundtland Commission in its report in 1987. The report emphasized maintaining a balance between the needs of the present generation and that of the future generation. It identified three dimensions of sustainability namely social, economic and environment. It argued that environmental concerns are significant and sustainable development is the one that satisfies the needs of the present generation but not at the cost of the ability of the future generations to satisfy their own needs (Kuhlman & Farrington, 2010). Read more »

India’s economic burden on its environment is heavier than anticipated

The environmental policies of any country intend to bring its environmental concerns to the forefront in pursuit of sustainable development. India has emerged as the sixth largest economy in 2018. It is also the second most populous country in the world with over 1.35 billion people (World Population Review, 2018). The country has been doing fairly well in terms of the creation of economic opportunities and large-scale urbanization. With the changing times, the country’s demand for expansion of urban environment is increasing, resulting in a boost in its real estate and the industrial sector. This article critically analyses the environmental policies vis-a-vis of Mauritius, Singapore, Japan, the Netherlands, and the UK. Read more »

FDI inflow in pharmaceutical, chemical, metallurgical and textile industry of India

The Indian economy witnessed a high FDI inflow after the reform of economic liberalization. The increasing trend continued in the last financial year 2017-18. This increase can be attributed to factors such as the high rate of GDP growth, low inflation rate, exchange rate, trade openness and economic and political stability. Since 2000, the service sector and selected industries in the manufacturing sector showed significant growth and were able to attract a large fraction of the total FDI. One of the reasons due to which these industries performed well is the union budget of 1999-2000 which supported greater inflow of FDI through the automatic route  (Singh, 2005). Increased FDI in these industries has opened up new doors for better technology, management and marketing networks. Furthermore, it has generated more employment opportunities and offered a high level of competition in domestic industries (Shapiro & Mathur, 2014). Read more »

An overview of the Indian Pharmaceutical industry

The Indian pharmaceutical industry has emerged as the third largest country in the world in terms of volume with a turnover amounting to US $ 21.04 billion in 2009. In addition to this, the industry includes more than 20,000 licensed companies that employs 500,000 people (Industry, 2011). Furthermore, Indian pharmaceutical industry secured the top position among the science based industries through a range of capabilities in production and technology. In terms of market segmentation, leading 250 pharmaceutical companies have controlled 70 % of the market (PwC, 2012). Read more »

FDI inflow plays a vital role to shape the Indian economy

Foreign Direct Investment (FDI) is a key driver for the growth in the Indian economy in the context of other developing countries. FDI inflow is the investment made by enterprises through joint ventures (JV) or mergers & acquisitions (M&A), to carry out business activities in host countries. Advantages of FDI inflow include:

  • building physical capital,
  • developing the skill of domestic labour force,
  • employment generation,
  • increasing productive capacity and
  • technology transfer and integration of the domestic economy with the world economy (Jayakumar, Kannan, & Anbalagan, 2014).

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An overview of the growing chemical industry in India

The Indian chemical industry has gained a major share in Asia’s growing contribution to the global chemical industry. It has also emerged as one of the preferred destinations for investment in the chemical industry worldwide (Chambers, Road, & Nadu, 2012). With the global share of 3 %, the Indian chemical industry covered a size of about $ 108 billion in 2012 and $ 290 billion in 2017 (Industry, Update, & Kapoor, 2018). Read more »

Establishing a relationship between FDI and air pollution in India

The previous articles in this study established how Foreign Direct Investment (FDI) affects the economic growth of a country. In India, in the last two decades, the inflow of FDI has grown significantly. Similarly, its environmental pollution has also been rising since 1991 due to an increase in economic activity. This article empirically investigates the impact of FDI on air pollution in India. In order to do so, it establishes a long run association between FDI inflows and air pollution in the post reform period, i.e. since 1991. The previous article identified the common air pollution indicators, of which Greenhouse Gas (GHG) emissions is the most significant. The figure below shows that total GHG emissions have increased drastically in India. Read more »

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