Foreign Investment Wasintroduced In 1991 Under Foreign Exchange Management Act (Fema). This Step Wastaken to Add some Source of Capital Formation In India As Other Developingeconomies Were Already In This Practice. As a Result Inflow of Foreign Capitalhas Become Striking Measure of Economic Development In Both Developed Anddeveloping Countries Now the Developing Countries Are Witnessing Changes In Thecomposition of Capital Flows In Their Economies Because of the Expansion Andintegration of the World Equity Market. Fdi and Fii Thus Have Become Instrumentsof International Economic Integration and Stimulation. the Indian Stock Marketsare Also Experiencing This Change. Fdi & Fii Are Becoming Important Sourceof Finance In Developing Countries Including India. It Is Widely Assumed Thatfdi & Fii Along With some Other External Factors Such As Global Economiccues, Exchange Rate and Internal Factors Such As Demand and Supply, Marketcapitalization, Eps Generally Drive and Dictates the Indian Stock Market. Unprecedented Globalizations Have Witnessed Double Digit Economicgrowth Resulting In Fierce Competition and Accelerated Pace of Innovation. As Aresult Inflow of Foreign Direct Investments Has Become a Striking Measure Ofeconomic Development In Both Developed and Developing Countries. Fdi and Fiithus Have Become Instruments of International Economic Integration Andstimulation. Fast Growing Economies Like Singapore, China, Korea Etc Haveregistered Incredible Growth at Onset of Fdi. Thoug ...