Impact of FDI on Unemployment Rate in India

Abstract

Investment is the fundamental factor for economic activities. Domestic investment is not sufficient for the development. So there are enormous needs for overseas investment in the pattern of Foreign Direct Investment (FDI). Foreign direct investment (FDI) is an investment which is made by a company or individual in any country in commercial interests into another country. The FDI have the potential to generate employment through direct hiring of people for new plants, which means they improve aggregate domestic employment through types of jobs created, regional distribution of new employment, wage levels, income distribution and skill transfer. So, the present study investigates the role of FDI on employment generation in India. It also analyses the sector wise and state wise trend in FDI inflows in India. Secondary data are the base for this study. It also applied linear regression model to see the impact of FDI inflow and unemployment rate.