The paper examined the sectoral dynamics of FDI in India. The main objective is to discuss the policy framework which has enabled increased amounts of FDI after 2014-15. The study found that the sectoral composition of FDI in India has shifted over the decades — from a relatively heavier share for manufacturing to a stronger tilt toward services and IT/knowledge-intensive sectors. Manufacturing remains important, especially in sub-sectors like automobiles, electronics, and infrastructure-related manufacturing; and in recent years it has seen renewed growth in FDI inflows. Balanced sectoral development may attract investment in complementary sectors.