FDI has been a Conterversial issue - read on this !!!!!!!!!!!!!!!
Foreign direct investment
Foreign direct investment (
FDI) or foreign investment refers to the net inflows of
investment
to acquire a lasting management interest (10 percent or more of voting
stock) in an enterprise operating in an economy other than that of the
investor.
. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the
balance of payments. It usually involves participation in
management,
joint-venture,
transfer of technology and
expertise. There are two types of FDI: inward foreign direct investment and outward foreign direct investment, resulting in a
net FDI
inflow
(positive or negative) and "stock of foreign direct investment", which
is the cumulative number for a given period. Direct investment excludes
investment through purchase of shares.
FDI is one example of
international factor movement.
Types
A foreign direct investor may be classified in any sector of the economy and could be any one of the following:
Foreign direct investment in India
Starting from a baseline of less than USD 1 billion in 1990, a recent
UNCTAD survey projected India as the second most important FDI
destination (after China) for transnational corporations during
2010-2012. As per the data, the sectors which attracted higher inflows
were services, telecommunication, construction activities and computer
software and hardware. Mauritius, Singapore, the US and the UK were
among the leading sources of FDI.
FDI in 2010 was $24.2 billion, a significant decrease from both 2008 and 2009.
Foreign direct investment in August dipped by about 60 per cent to
aprox. USD 34 billion, the lowest in 2010 fiscal, industry department
data released showed.
In
the first two months of 2010-11 fiscal,FDI inflow into India was at an
all-time high of $7.78 billion up 77% from $4.4 billion during the
corresponding period in the previous year.
The world’s largest retailer WalMart has termed India’s decision to
allow 51 per cent FDI in multi-brand retail as a “first important step”
and said it will study the finer details of the new policy to determine
the impact on its ability to do business in India.
