SUMMARY The Indian automotive industry is one of the largest industries globally and a key sector of the economy. The automotive industry is one of the major industries in India and now one of the fastest growing industries in the world in terms of vehicle production. The automotive sector in the Indian industry is one of the best performing sectors of the Indian economy, this has largely added to the creation of India an important intention for many international players of the automotive industry who wish to settle their operations in India. The automotive industry in India is growing at 18% per year. The automobile sector in India was opened for foreign investment in 1991. 100% foreign direct investment is allowed in the automobile industry. FDI inflow into the automobile industry has been at an increasing pace as India has witnessed major economic liberalization over the years in terms of various sectors. The automotive sector in India is growing at 18% per year. The key advantages provided by India in the automotive sector include advanced technology, cost-effectiveness and efficient manpower. Furthermore, India has a well-developed and competent automotive ancillary industry along with automotive R&D and testing centers. The automotive sector in India ranked third in the production of three-wheelers and second in the production of two-wheelers. The major investing countries are Mauritius, USA, Japan, UK, Germany, Netherlands and South Korea. The main objective of this research is to study foreign direct investment in the Indian automotive sector. The researcher used both primary and secondary data to achieve all the research objectives. INTRODUCTION Purpose of the studya. Study the concept of foreign direct investmentb. To examine the F...... center of the paper industry. Productivity. Performance of Indian Automobile Industry with respect to Productivity Growth, Partial and Total Production Productivity of Indian Automobile Industry were calculated from the period 1990-91 to 2010-11, using Divisia-Tornquist index for estimating the growth in total factor productivity. The Suthor believes that the domestic automotive industry has experienced negative and insignificant productivity growth during the last decade and a half. Among the partial factor productivity indices, only labor productivity saw a significant improvement, while the productivity of the other three inputs (capital, energy and materials) did not show any significant improvement. Labor productivity increased mainly due to increases in capital intensity, which grew at a rate of 0.14% per year from 1990-91 to 2010-11.