Post on 30-May-2018
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Presentation on Foreign Direct Investment
(404)
Presented By: Submitted To:
Sachin Patil Mr. Anil Sharma
MBA II, NMU (40) .
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IMPACT OF FDI IN INDIAN ECONOMY
INTRODUCTION TO FDI:
Foreign Direct investment is theinvestment, which is made to serve the
business interests of the investor in a
company, which is in a different nation
distinction from the investors country of
the origin.
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TYPES OF FDI
05
BY
DIRECTION
INWARD
OUTWARD
BY
TARGET
GREENFIELD
INVESTMENT
HORIZONTAL FDI
VERTICAL FDI
BY
MOTIVE
RESOURCE
SEEKING
MARKET
SEEKING
EFFICIENCY
SEEKING
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FOREIGN DIRECT INVESTMENT (FDI)
Foreign Direct Investment (FDI) means a company or any
other entity in one country making a physical investment in
other country.
FDI includes investments made to acquire a lasting interest in
enterprises that are operating outside the economy &
national borders of an investor.
FDI (for a country) represents foreign assets in domestic
structures, equipments & organizations.
FDI does not include foreign investments in stock markets.
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INVESTOR
(HOME COUNTRY)
RECEIVER
(FOREIGN COUNTRY)
INVESTMENT OUTFLOW
RECEIVER
(HOME COUNTRY)
INVESTOR
(FOREIGN COUNTRY)
INVESTMENT INFLOW
02
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BENEFTS OF FDI
INFLOW OF CAPITAL IN HOME COUNTRY
REPATRIATION OF PROFITS BY INVESTOR
TECHNOLOGY DEVELOPMENT & TRANSFER
TRANSFER OF KNOWLEDGE
ACCESS TO NEW MARKETS
FDI LED EXPORT GROWTH
EMPLOYMENT GENERATION
INFRASTRUCTURE DEVELOPMENT IN HOME COUNTRY
LEADS TO LIBERALIZATION & GLOBALIZATION
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ADVANTAGES OF FDI:
FDI develops the economy of both host andhome country.
FDI permits the technology transfers.
Employee enrichment in training andoperations.
It creates new jobs and advanced technology.
It pays an avenue to receive the funds in lowerrate of interests.
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DISADVANTAGES OF FDI:
There is a chance to spread the nationalsecrets.
The host country workers may dissatisfy with
the policies.
Problem in language and culture.
Size and condition of the market to theadvanced technology.
Government faces the problem to control the
operations of host country FDI.
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ROLE OF FDI ON INDIAN ECONOMY:
FDI plays a major role in Indian economy,FDI creates lot of new opening and hike inindividual salary because of it the life style getdeveloped so automatically the growth of theeconomy get leveraged.
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FDI POLICY IN INDIA
The Government of India has put in place a liberal, transparent and
investor friendly FDI Policy, wherein FDI up to 100% is allowed on
the automatic route in most of the sectors, except in:
Activities that attract industrial licensing
Proposals where foreign investors have existing ventures in India
Proposals for acquisition of shares in an existing Indian company
by a non-resident investor
Activities where automated route is not available
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CONCLUSION:
The growth of economy was notcommendable before 1991, after implementingLPG (Liberalization, Privatization &Globalization) there is a tremendous growth inIndian economy due to flow of foreigninvestment and opportunities provided in Indiato receive it.
According to me FDI plays a major role to
develop the Indian economy but to safe guardthe Indian SMEs the government can reframethe FDI policies or the FDI can put its eyes ontechnology transfer.
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