Emerging Issues, Perspectives, and Challenges of India’s Foreign Economic Policy – Focus on Finance and Trade in the 21st Century

India’s Foreign Economic Policy (FEP) is evolving rapidly, moving from a self-reliant approach to a more open, market-driven strategy. The document highlights India’s efforts to boost trade, attract foreign investment, and strengthen global economic ties. It also acknowledges key challenges, including stiff competition from China and Southeast Asia, declining foreign aid, and the need for better infrastructure. Despite these hurdles, India’s large domestic market, skilled workforce, and growing economic strength make it well-positioned to expand its global influence.

The document traces India’s journey from a closed economy to a more liberalized trade and investment environment. It discusses how economic reforms since 1991 have helped the country integrate with global markets. Regional and multilateral partnerships, such as SAARC, ASEAN, and the Indian Ocean Rim Association (IOR-ARC), are seen as valuable, but India still faces obstacles in maximizing their potential.

A major focus is on attracting more Foreign Direct Investment (FDI), especially in infrastructure and manufacturing. While policies have been relaxed, India has struggled to fully capitalize on investment opportunities from key economies like the US, UK, and Japan. The paper also stresses the need for India to build global brands, improve quality standards, and develop a stronger international trade presence.

The conclusion is clear: for India to thrive in a competitive global economy, it must remove trade barriers, encourage investment, improve ease of doing business, and strengthen its international presence. The document urges a strategic, forward-thinking approach that ensures India maximizes its economic potential and becomes a key player in the 21st-century world economy.

Keywords: Foreign Economic Policy (FEP), Trade Liberalization, Investment, Globalization, Economic Openness, Multilateral Relations, Foreign Direct, Investment (FDI), Regional Cooperation, Competitiveness, Macroeconomic Vision, India