A Study on Impact of Fdi on Service Sector
A STUDY ON IMPACT OF FDI ON SERVICE SECTOR
Presented By:
Ms Pushpa A
Dept of Management studies
Garden City College
Bangalore|
Ms Shymala J.
Dept of Management studies
Garden City College
Bangalore|
|
ABSTRACT
The last two decades have witnessed an unprecedented growth of the Indian service sector. FDI is a tool for economic growth through its strengthening of domestic capital, productivity and employment. FDI plays a vital role in the up gradation of technology, skills and managerial capabilities in various sectors of the economy. The study aims to analyze the growth dynamics of the FDI. It intends to see whether the growth in FDI has any significant impact on the service sector growth and also investigates whether a growth in this sector causes the GDP to grow, also analyzes the significance of the FDI Inflows in Indian service sector. The study also looks into the sub-sectoral dynamics and indicates towards the fact that the trade, hotels and restaurants, transport. storage and communications sub-sector contributes the most in the growth of Indian service sector. The results suggest that there has been a significant positive impact of the FDI on services sector and this service sector growth has in turn a significant effect on the GDP. Therefore FDI can be truly be used as a propagator of economic growth, via its favorable effect on the growth in the services sector.
Key Words: FDI, Service Sector, Employment development, GDP
I. INTRODUCTION
Foreign Direct Investment (FDI) broadly encompasses any long-term investments by an entity that is not a resident of the host country. The investment is over a long duration of time. FDI to developing countries in the 1990s was the leading source of external financing. It is one of the most important component of national development strategies for most of the countries in the world and an important source of non-debt inflows for attaining competitive efficiency by creating a meaningful network of global
Presented By:
Ms Pushpa A
Dept of Management studies
Garden City College
Bangalore|
Ms Shymala J.
Dept of Management studies
Garden City College
Bangalore|
|
ABSTRACT
The last two decades have witnessed an unprecedented growth of the Indian service sector. FDI is a tool for economic growth through its strengthening of domestic capital, productivity and employment. FDI plays a vital role in the up gradation of technology, skills and managerial capabilities in various sectors of the economy. The study aims to analyze the growth dynamics of the FDI. It intends to see whether the growth in FDI has any significant impact on the service sector growth and also investigates whether a growth in this sector causes the GDP to grow, also analyzes the significance of the FDI Inflows in Indian service sector. The study also looks into the sub-sectoral dynamics and indicates towards the fact that the trade, hotels and restaurants, transport. storage and communications sub-sector contributes the most in the growth of Indian service sector. The results suggest that there has been a significant positive impact of the FDI on services sector and this service sector growth has in turn a significant effect on the GDP. Therefore FDI can be truly be used as a propagator of economic growth, via its favorable effect on the growth in the services sector.
Key Words: FDI, Service Sector, Employment development, GDP
I. INTRODUCTION
Foreign Direct Investment (FDI) broadly encompasses any long-term investments by an entity that is not a resident of the host country. The investment is over a long duration of time. FDI to developing countries in the 1990s was the leading source of external financing. It is one of the most important component of national development strategies for most of the countries in the world and an important source of non-debt inflows for attaining competitive efficiency by creating a meaningful network of global