External capital is mainly generated by Foreign Direct Investment for developing countries like India. FDI inflows are important for the economic growth and development of a country as they bring in new technology, managerial skills, and access to international markets. FDI also helps to create employment opportunities and promote entrepreneurship. Over the years, India has undertaken several policy reforms to encourage FDI inflows in various sectors of the economy. The determinants of FDI in India can be broadly classified into two categories: macroeconomic factors and sector-specific factors. Macroeconomic factors include the overall economic and political environment of the country, while sector-specific factors include the attractiveness of specific sectors for investment. Some of the macroeconomic factors that influence FDI inflows in India include the size of the economy, the level of exchange rates, interest rates, inflation rates, economic growth, and the stability of the political environment. The government's policies and regulations also play a vital part in appealing FDI to India. The study focused on analysis the role of GDP in attracting in FDI inflow in India. Data of FDI inflow in India and GDP was collected form World Development Indicators for the time period 2001-2021 as it was available till 2021. The data was analyzed for trend analysis and regression equation was run in Eviews 9.

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Keywords: FDI, Determinants, Microeconomic, Macroeconomic, Economic Growth.