The geo-strategic implications of FDI

In the cacophony of debates on the wisdom of liberalising retail foreign direct investment, or FDI, one viewpoint was noticeably absent: whether and how this might affect India’s strategic interests. While retail FDI seems a far cry from strategic interests, the more pertinent question is the broader implications of FDI on India’s strategic interests, as distinct from the more obvious – and much debated – economic effects. The demise of the Soviet Union, the current decline of the United States and the concurrent rise of China have made abundantly clear that a country’s domestic economic strength is the foundation of its power in the world.