The paper analyzed the sector and country wise trend of foreign direct investment (FDI) inflows in India from 1991-92 to 2012-13. The paper found negative trends in sectors such as electrical equipment, transportation, chemicals, food processing and positive trend in the metallurgical and service sector. The paper also investigated the determinants of FDI inflows in India since 1980-81. The study was conducted taking data from various secondary sources. The study used OLS method to estimate various parameters of the determinants of FDI inflows. The paper found that lagged FDI inflow (one period), inflation rate, share of manufacturing sector in GDP, interest rate, per capita income were significant determinants of FDI inflows in India (except occurrence of riots). The variables taken showed expected signs, including the occurrence of riots. The paper included one dummy variable since 1991 to examine the impact of liberalization policy on FDI inflows and found that the variable was significant. This means that liberalization of the economy has increased FDI inflows in India.

1. Aharoni, Y. (1966). The foreign investment decision process. Cambridge Mass : Harvard University Press.
2. Balasubramium, V.N., & Mahalbare, V. (2003). Foreign direct investment in India (Working Paper No. 2003/001). Lancaster, UK : Lancaster University Management School.
3. Bennett, P. D., & Green, R.T. (1972). Political instability as a determinant of direct foreign investment in marketing. Journal of Marketing Research, 9 (2), 162- 186.
4. Gopinath,T.(1997). Foreign investment in India: Policy issues, trends and prospects. Reserve Bank of India-Occasional Papers, 18 (2 & 3), 453 - 470.
5. Hymer, S. H. (1976). The international operation of national firms: A study of direct foreign investment. Cambridge : MIT Press.
6. Jun, K. W., & Singh, H. (1996). The determinants of foreign direct investment in developing countries. Transnational Corporations, 5 (2), 67 - l05.
7. Krishna, M. J., & Venugopal, J. (2003). Determinants of private foreign investment in post-reform India. Savings and Development, 27 (4), 441-461.
8. Lucas, R. E. B. (1993).On the determinants of direct foreign investment : Evidence from East and Southeast Asia. World Development, 21 (3), 391 - 406.
9. Mottalab, K.A., & Kalirajan, K. (2010). Determinants of foreign direct investment in developing countries : A comparative analysis. The Journal of Applied Economics Research, 4 (4), 369-404.
10. Noorbakhsh, F., Paloni, A., & Youssef, A. (2010). Human capital and FDI inflows to developing countries : New empirical evidence. World Development, 29 (9), 1593-1610.
11. Root, F. R., & Ahmed, A. (1979). Empirical determinants of manufacturing direct foreign investment in developing countries. Economic Development and Cultural Change, 27 (4), 751-767.
12. Sahoo, D. (2004). An analysis of the impact of foreign direct investment on the Indian economy (PhD Thesis). Bangalore : ISEC.
13. Schneider, F., & Frey, B. S. (1985). Economic and political determinants of foreign direct investment. World Development, 13 (2), 161 - 175.
14. Secretariat of Industrial Assistance, Government of India. (2012). News letters. New Delhi : Department of Industrial Policy and Promotion, Government of India.
15. Shamsuddin, A. F. M. (1994). Economic determinants of foreign direct investment in less developed countries. The Pakistan Development Review, 33 (1), 41-51.
16. Singhania, M., & Gupta, A. (2011). Determinants of foreign direct investment in India. Journal of International Trade Law and Policy, 10 (1), 64-82.
17. The World Bank, (1999). World Investment Report. Washington, D. C. : World Bank.
18. The World Bank. (1998).World Investment Report. Washington, D. C. : World Bank.
19. United Nations Centre on Transnational Corporations (UNCTAD). (1993). Explaining and forecasting regional flows of foreign direct investment. New York : United Nations Publications.
20. Walsh, J. P., & Yu, J. (2010). Determinants of foreign direct investment : A sectoral and institutional approach (Working Paper No. 10/187). International Monetary Fund. Retrieved from <a href=https://www.imf.org/external/pubs/ft/wp/2010/wp10187.pdf target="_blank">https://www.imf.org/external/pubs/ft/wp/2010/wp10187.pdf</a>