India's inward investment regime went through a series of changes since economic reforms were ushered in two decades back. The expectation of the policy makers was that an “investor friendly” regime will help India establish itself as a preferred destination of foreign investors. Ever since India has embraced liberal economic policies by opening up its markets post 1991-92, capital inflows generated by foreign direct investment (FDI) and foreign portfolio investment (FPI) has proved to be indispensable for the cause of propulsion of economic growth of the country.