FDI stumbles, too

Govt must not abandon structural reforms

Recent reports have confirmed that all is not well when it comes to foreign investment in India. Foreign direct investment (FDI) in particular — prized over other forms of capital flows because it directly adds to the productive base and is long-term and patient in nature, unlike the “hot money” of portfolio investment — is slowing. The growth rate of FDI hit a five-year low in 2017-18, according to recent data from the Department of Industrial Policy and Promotion (DIPP). It grew by only 3 per cent, to $44.85 billion – although this year saw the big-ticket purchase of Essar