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Foreign Direct Investment

The foreign direct investment in any country has been playing highly productive and significant role in the development and progress of the destination country, besides being hugely lucrative to the foreign investors. Most of the developed and developing countries of all around the world have been receiving foreign direct investment in diverse economic sectors from investors belonging to all across the globe. One of the major and steadily fast growing economies of the world, India too has been drawing enormous foreign direct investment in most of its major and fast-developing and growing economic sectors since last few decades. India’s extensive market is irresistibly attractive and impressive to companies, multinational conglomerates, and investors of every part of the world, for fathomless consumption of their products and services, and tremendous growth of their international businesses. Hence, India is presently one of the most famous, popular, and preferred destinations in the whole world, for highly and hugely profitable business ventures and investments, in its growth-oriented economic sectors. The most prominent countries which have been showing great enthusiasm and optimism in fdi india, are United Kingdom, USA, France, Germany, several Asian countries, Australia, and many others.

Benefits & Disadvantages of FDI India

The foreign direct investment offers certain advantages and disadvantages to both investors and the recipient country. This fact holds good for every FDI destination in the world. Hence, there are some exclusive profits and losses to be obtained through foreign direct investment in India too, to both the foreign investors and country, and the concerned people and the nation of India. In the paragraph below are described the benefits and disadvantages of foreign direct investment in diverse sectors of India.

To the foreign investors the outstanding benefits to be obtainable from fdi india, are extensive Indian market for their products and services, qualified professionals and labor at quite economical expenses, India’s steadily fast-growing economy and market, liberal policies of Indian Government, India’s being one of the well-accessible center for conducting worldwide businesses, increased facilities for maritime trade, and strong chances of better and prosperous future. While the disadvantages of fdi in India to them are uncertainty of Indian market, its regularly growing number of domestic and foreign companies in various sectors, uncertain political situation, chances of increment in the cost of labor and employment in the future, etc.

The conspicuous benefits of fdi to India are fast and desired development and refinement in its industrial, commercial, and professional sectors; increased opportunities for employment to Indian professionals and labor; technology transfers for better quality of products and services; progress at par with the global levels; expected high growth in inflow of foreign money, and many others. Apart from these benefits of foreign direct investment to India and Indian people, there are certain inherent disadvantages probable, such as reduced opportunities to Indian companies and investors for businesses in diverse sectors, intense and growing business competition in Indian market, higher cost of qualified employment and skilled labor, and expected eventual monopoly of foreign companies in the long run.