Foreign direct investment (FDI) equity inflows have registered a phenomenal upswing from $2.2 billion in 2003-04 to $15.7 billion in 2006-07 - a five-fold increase.

In other words, FDI has increased just from 0.77 per cent of GDP in 2003-04 to 2.31 per cent in 2006-07 and as a percentage of total investment from 2.55 per cent in 2003-04 to 6.42 per cent in 2006-07.

The government has now set a target of $30 billion in 2007-08.

Due to progressive delicensing, only five sectors remain within the ambit of compulsory licensing, on account of safety, security and environmental concerns. These are distillation and brewing of alcoholic drinks; cigars and cigarettes of tobacco and manufactured tobacco substitutes; electronics aerospace and defence equipment; industrial explosive including detonating fuses, safety fuses, gun powder, nitrocellulose and matches; specified hazardous chemicals viz. : (i) hydrocyanic acid and derivatives (ii) phosgene derivatives and (iii) isocyanates  and disocyanates of  hydrocarbon.

In 1991, 839 items were under reservation for small scale industries (SSI) sector. After progressive liberalisation now only 114 items are left reserved for SSI sector, after 561 items were de-reserved from the SSI sector in the last three years.         

Consequent to the policy undertaken the share of the industrial sector to the GDP (at constant prices) has grown from 25.6 per cent in 2003-04 to 26.6 per cent in 2006-07, thanks largely due to the growth of the industrial sector from 7.4 per cent in 2003-04 to 10.9 per cent in 2006-07, along with a double digit growth in the manufacturing sector from 6.6 per cent in 2003-04 to 12.3 per cent in 2006-07.

The capital goods sector recorded a growth of 13.9 per cent in 2004-05, 15.8 per cent in 2005-06 and 18.2 per cent in 2006-07. This indicates a robust capacity addition in the industrial sector.

However, India is still regarded as a difficult place to do business in. In the World Bank's latest Doing Business 2008, 178 economies have been compared in terms of ease of doing business on various parameters, with India being placed at the 120th.