Foreign Direct Investment Policies And Regulations: A Comparative Study Of India And Sri Lanka
- IJLLR Journal
- Aug 6
- 1 min read
Digvijay Singh, Himachal Pradesh University
ABSTRACT
In this review paper, the author compares the Foreign Direct Investment (FDI) policies and regulatory frameworks of two South Asian countries, namely India and Sri Lanka. The historical development of FDI regimes, sectoral dynamics, institutional processes, and the role of policy restrictiveness on investment performance are all examined. The paper determines key areas of the divergence and convergence between these countries by comparing the inflows, outflows, source countries, GDP indicators, and FDI openness indices. While India has already made steady liberalization of its FDI environment, attracting diversified investment in many strategic sectors and controlled by policy reforms and macroeconomic stability, Sri Lanka having a more restricted FDI flow is experiencing more economic disturbances and difficulties relating to regulations. The findings of this paper support the fact that transparent, stable, and sector-specific policies lead to the development of investor confidence. The research provides the conclusion that both countries are capable of raising their investment ranking within the world arena by implementing specific changes to the way in which the country strives to operate related to the best practices as defined by other nations.
