Towards a sustainable FDI policy for power sector development

Abstract

Foreign Direct Investment (FDI) and its infrastructure development potential has been the focus of management scholars for long. Indian power sector, marked by years of under-investment and ever increasing demands can also leapfrog by infusion of FDI. India has the potential to attract far more FDI in the power sector as compared to less than 4% of the nation’s total FDI that it attracts at present. The root of the problem is as much a question of inadequate reforms as it is of insufficient investment inflow. Therefore, we have undertaken this study that attempts to examine the determinants of FDI in order to enable Indian power sector to attract more FDI and to benefit from these capital inflows.