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Foreign direct investment (FDI) is an investment in a business by an investor from another country for which the foreign investor has control over the company purchased. The need for foreign capital for a developing country like India could arise on account of the following reasons reasons. Foreign capital is usually essential atleast as temporary measure during the period of development. Foreign capital usually brings with it with other scarce productive factors like technical know how. Domestic capital is inadequate for purpose of the economic growth and it is necessary to invite foreign capital as per the requirement. At many times, domestic capital and entrepreneurship may not flow into certain lines of production. Foreign capital can show the way for domestic capital. There can be potential savings in a developing economy like India but this may come forward only at a higher level of economic activity. Therefore it is necessary that foreign capital should help in speeding up economic activity in the initial phase of development.

Fdi (Foreign Direct Investment) in India ; the Major Monetary Source for Economic Development With Special Emphasis on Computer Sector