Foreign Direct Investment (FDI) is a type of investment made by a foreign entity, such as an individual or a company, in a domestic company or enterprise. It involves the transfer of capital, technology, and other resources, and is considered an important source of non-debt creating capital flow in the recipient country.

The major characteristic of FDI in India is that it is largely non-debt creating capital flow. This means that FDI does not result in a significant increase in the country`s external debt burden, unlike other forms of capital flows such as foreign portfolio investments, which can be volatile and may lead to an increase in the country`s external debt.

Additionally, FDI involves a long-term commitment by the foreign investor, as opposed to short-term investments such as foreign institutional investments in government securities. FDI also typically involves a direct equity stake in the domestic company, rather than investment through capital instruments like stocks and bonds.