Foreign Investment in India: Changing Dimensions of Foreign Direct Investment (FDI), Foreign Portfolio Investment (FPI), and Joint Ventures

After liberalisation (1991), foreign investment has been the key driver of the country's growth and industrialisation, and of its economic integration with the rest of the world. Foreign investment has been an important contributor to the capital formation, technology transfer, job creation and development of infrastructure in India, which has been achieved via 3 types of foreign investment includes Foreign Direct Investment (FDI), Foreign Portfolio Investment (FPI) and Joint Ventures (JVs). FDI helps to foster long-term business growth and participation of management, while FPI enhances the liquidity of financial markets through investment in financial securities. Joint ventures help build strategic partnerships, bringing foreign know-how and local resources and expertise to the table. The foreign investment regime in India, under the Foreign Exchange Management Act, 1999, the Companies Act, 2013, SEBI Regulations and Consolidated FDI Policy, has been undergoing changes to ensure an optimum balance between investments and national security and regulatory control. It examines the changing facades of foreign investment in India, a brief overview of the legal framework, certain key policy shifts and judicial changes, and recommends for making India an investment haven in the international arena.