Foreign Direct Investment (FDI) is a key component of national development strategies for all most all the countries over the Globe. FDI is considered as life blood of economic development as far as the developing nations are concerned. It is a key factor for growth of economy. During last fifteen years FDI trends shows that India is the best destination for FDI. Foreign investment would bring attendant advantages of technology transfer, marketing expertise, introduction of modern managerial techniques and new possibilities for promotion of exports. FDI is needed for the interest of the country’s industrial development. In the recent time FDI is considered to be the most attractive type of capital flow for India’s emerging economies as it is expected to bring latest technology and enhance production capabilities of the economy. This paper discusses the trend of FDI from 2000-01 to 2013-14 and evaluate its impact on Trade, GDP, Foreign exchange. It makes an attempt to throw some light on importance of FDI and also reveals about factors which works as barriers in FDI inflows.