Investment and Political Risk in India and Legal Means of Response

　　ABSTRACT: Generally speaking, following its independence, India has maintained a policy friendly to foreign investment, especially since its free market reforms of 1991. While India’s political, legal and economic institutions are favorable in terms of preventing large scale political risk, the risk of nationalization or acquisition, exchange rate risk, risk of government breach of contract, or risk related to war or turmoil still exist. In response, foreign investors in India must take certain legal measures to prevent or eliminate political risk and ensure returns on investment.