FDI is treated as an important mechanism for channelizing transfer of capital and technology and thus perceived to be a potent factor in promoting economic growth in host countries.  This research paper studies the impact of FDI on the economic condition of the Indian economy. It provides the relevant basis to understand the importance of FDI in India especially when it is under the transformation from a developing economy to a developed economy. it is very well known that India is very rich in resources and is a labour intensive economy but we are lacking in capital and technology for which we have to be dependent on the developed economies if we want to exploit our resources to its fullest utilisation i.e. maximum utilisation of resources. Hence FDI can be one of the best alternatives. This research paper is about to study that whether there is a positive impact of FDI or not on the growth of the Indian economy or not. GDP has been used as the indicator of economic growth.

Keywords: Liberalisation, Influx, Growth, Development, Technology.