India needs to improve its investment climate significantly to attract foreign direct investment (FDI), a parliamentary panel said on Thursday.

The Parliamentary Standing Committee (PSC) on Finance headed by former finance minister Yashwant Sinha said in its report that the inflow of extra resources in the form of FDI is crucial for various sectors of the country, such as infrastructure, high technology and export.

The report titled "Current Economic Situation & Policy Options" said, the investment climate of our country has to be improved considerably to attract FDI in areas like infrastructure, high technology and export oriented sectors."

The committee underlined that As India's policy makers are struggling to find ways to arrest the ongoing slowdown in the Indian economy, addition resources in the form of FDI could provide a great boost to some crucial sectors of the economy.

The Parliamentary panel report also expressed concerns over the lack of sync between fiscal and monetary policies followed by the government and the RBI. It urged the government to take firm steps to supplement RBI's initiatives to arrest inflation and boost sustainable growth.

The economic growth in India dropped sharply to 6.5 per cent in 2011-12, and to 5.3 per cent during the three months through March this year, the worst in the last nine years. Economists are of the view that the April-June quarter could be even worse.