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Drugs and pharmaceuticals figure amongst the top five sectors accounting for the maximum foreign direct investment (FDI) inflows into India during the period April 2002 to December 2004. The other four sectors are: electrical equipments, transportation industry, services sector and telecommunications. FDI is an important driver of economic growth. Besides complementing and supplementing domestic investment, FDI also brings in technological upgradation and best managerial practices and helps in making the Indian industry internationally competitive.
As per the FDI inflows reported by the Reserve Bank of India (RBI) regional offices, Delhi ranks irst in terms of FDI inflows received uring April 2002 to December 2004, followed by Maharashtra, Tamil Nadu and Karnataka. Government of India have put in place a liberal, transparent and an investor-friendly FDI policy nder which FDI up to 100% is allowed under automatic route for most sectors/activities including power generation, transmission and distribution, except atomic power; roads and highways; and most of the mining activities. FDI up to 26% is allowed in the newspapers. FDI policy, including the procedures, are reviewed on an ongoing basis to facilitate greater inflow of FDI into the country. The government have recently allowed FDI up to 100% under the automatic route or the development of townships, housing, built-up infrastructure and construction-development projects.
According to an analysis carried out by ASSOCHAM on FDI inflows in proportion to country's DP, India's FDI-GDP ratio is 0.8% as against 4.3% in China, 4.7% in UK, 4% in Brazil, 3.7% in Thailand, 3% in Mexico and 16.8% in Hong Kong
SB/MRS
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