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Abstract
Most of the underdeveloped countries and emerging economies like India suffer from low level of income and low level of capital accumulation. Despite this shortage of capital, these countries have developed a strong urge for industrialization and economic development. India launched upon an ambitious programme of industrialization during the second plan. Since the domestic resources to carry out this programme of industrialization were insufficient the country had to depend on foreign capital. With the help of post liberalization policy India received more foreign direct investment from various countries. For improving infrastructure facilities, creating new Job opportunities and ,increasing exports ,India need more Foreign direct investment. But the real case for encouraging private foreign investment rests on whether it helps in raising productivity or not. If it does, the greater product must be shared with the others. India received FDI in almost all sectors; as a result it can able to achieve more growth with a short period of time. This paper tries to highlight the relevance of foreign direct investment to the growth and development of a country