With increasing globalization and rapidly growing technology and infrastructure, trade between countries have become vital for the economies involved. Economists and Financial experts have repeatedly stressed about need of FDI inflows to achieve a high trajectory of economic growth for a country. This study emphasis on FDI with the Indian perspective. The start of the thesis focuses on FDI in general and trends seen in India. Then the preceding sections of the study focuses on the determinants and effects of FDI in India and in-depth analysis of the same. Also, keeping a track on spillovers on local economy by foreign investment.