International Journal of Business and Social Science

ISSN 2219-1933 (Print), 2219-6021 (Online)

Exploring the Link between Foreign Direct Investment and Multinational Enterprises for Developing Innovative Competitive Strategies in India
Dr. Manjusmita Dash

Abstract
Multinational enterprises exist because they hold certain competitive advantages over their local counter parts and affect local economies through their spillover effects. Globalization of economic activities has increased the importance of multinational enterprises in the development process of a country. The inflow of Foreign Direct Investment (FDI) increased rapidly during the late 1980s and the 1990s in almost every region of the world revitalizing a contentious debate about the costs and benefits of FDI inflows. The reforms undertaken in India since 1991 have unleashed the potential growth of the economy and stimulated trade, outsourcing and the entry of multinational enterprises under the banner FDI. In recent years, India has become one of the attractive destinations for overseas investment as adduced by FDI inflow figures of India to achieve sustained economic growth in developing countries. This is because globalization and the attendant opening of the economies to competition require increased financial resources and technology. The paper also opens a new avenue for the researchers by pointing towards a potential connection between FDI and competitive advantages of MNEs

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