02059nam a22001337a 4500 532942 532942 260402b ||||| |||| 00| 0 eng d Paramashivaiah, P. and Chakraborthy, Shreya 59955 Foreign direct investment and inclusive growth in India: A comparative sectoral and regional perspective Productivity 66(3), Oct-Dec, 2025: p.316-325 This research paper provides a comprehensive and in-depth analysis of the impact of foreign direct investment (FDI) on India’s economic growth and employment generation. FDI has been a crucial component of India’s economic strategy since the liberalization reforms of 1991. This paper explores how FDI contributes to GDP growth, sectoral employment distribution, and the broader economic landscape. The study also delves into the reasons for declining FDI inflows in recent years, comparing India’s performance with key Southeast Asian economies (Vietnam, Thailand, Malaysia, Indonesia, and the Philippines) from 2010 to 2020. Using panel data regression analysis, this paper quantifies th effects of GDP growth, trade openness, inflation, infrastructure quality, political stability, ease of doing business, and corporate taxation on FDI inflows. The findings suggest that while FDI significantly enhances GDP growth, its direct impact on employment varies across sectors, depending on labor intensity, investment policies, and industry competitiveness. The paper also investigates global capital flows and how shifts in geopolitical and macroeconomic conditions influence FDI redirection from India to Southeast Asia. Furthermore, the research evaluates India’s FDI policies in relation to global best practices and provides targeted policy recommendations to enhance India’s attractiveness as an investment destination. The findings from this paper contribute to an improved understanding of FDI dynamics and its role in shaping employment trends and economic progress in emerging markets like India. Productivity AR 0 0 ddc 0 0 408117 IIPA IIPA 2026-04-02 66(3), Oct-Dec, 2025: p.316-325 AR138458 2026-04-02 AR