'Opening doors doesn't mean they will come'
According to Barclays' Bajoria, attracting foreign investors is a multi-layered issue for India and is not as simple as improving accessibility.
"Just opening the doors doesn't mean they will come. It's not just one set of issues and isn't just about accessibility," he said. "A company does not necessarily need to be based in India to sell its produce there, look at Procter & Gamble [U.S. consumer goods conglomerate], for example, they manufacture abroad and have no problems distributing their goods in India," added Bajoria.
Rajiv Biswas, chief economist of Asia-Pacific at research house IHS Global Insight, said India's plans to further lift foreign direct investment caps in some sectors were a positive step in the right direction, but unfortunately come at a time when there are growing concerns about the overall business climate.
(Read More: Why India's most promising sectors fail to deliver)
He said there are other stumbling blocks, like weak infrastructure and complex regulatory "red tape" which Indian policy makers need to work on improving to make the country attractive to foreign investment.
"Until India can stabilize inflation, the balance of payments situation, and get GDP growth back above 7 percent, foreign investors are likely to remain cautious about the Indian business outlook," Biswas said.
Still, India's consumption power is not lost on investors, and that should keep foreign firms interested despite the challenges.
"The long term attractiveness of India as a key growth market remain strong, due to its large and fast-growing middle class consumer spending power," Biswas said.
—By CNBC's Katie Holliday. Follow her on Twitter: @hollidaykatie