FDI(Foreign Direct Investment) Team Members Gaurav Prakash Divyadarshi Deepshikha Deepak Choudhary

INVESTMENT Portfolio investment Investment that does not involve obtaining a degree of control in a company Foreign Direct Investment Purchase of physical assets or a significant amount of the ownership (stock) of a company in another country to gain a measure of management control

Invesment in India Automatic Route Prior Permission (FIPB) General Rule No prior permission required Inform Reserve Bank within 30 days of inflow/issue of shares By Exception Prior Government Approval needed. Decision generally within 4-6 weeks

FDI Direct investment into production or business in a country by a company in another country. Either by buying a company in the target country or by expanding operations of an existing business in that country.

FDI inflows by Region and Economy

Sector-wise FDI inflows in India

Top country Investors in India

Forecast of FDI In India

Advantages of FDI Increase investment level and thereby income & employment Increase tax revenue of government Facilitates transfer of technology Encourage managerial revolution through professional management Increase exports and reduce import requirements Increase competition and break domestic monopolies Improves quality and reduces cost of inputs

Limitations of FDI Flow to high profit areas rather than main concern areas Through their power and flexibility, MNC can undermine economic autonomy and control Sometimes interferes in the national politics Sometimes engage in unfair and unethical trade practices Sometimes result in minimizing / eliminating competition and create monopolies or oligopolistic structures

100% FDI permitted in India Engineering & Manufacturing sectors Roads & Highways, Ports and Harbors Industrial model towns/industrial parks Hotels & Tourism Pollution Control and Management Advertising & Film industry Power generation (hydro-electric, coal/lignite, oil or gas based) Information Technology including E-Commerce

Factors affecting FDI Profitability: Attract where return on investment is higher Costs of production: Encouraged by lower costs of production like raw materials, labor . Economic Conditions: Market potential, infrastructure, size of population, income level etc Government policies: Policies like foreign investment, foreign collaboration, remittances, profits, taxation, foreign exchange control, tariffs etc. Political factors: Political stability, nature of important political parties and relations with other countries.

OBJECTIVE OF THE STUDY The main objective of the study is to know about in which sector the industries are invest our money . To identify factors which inhibit higher FDI and suggest remedial steps. To examine policy reforms towards mergers and acquisition for attracting FDI To suggest changes in institutional apparatus and organizations, both in Centre and States, for attracting the FDI .

CONCLUSION The result of all these efforts are encouraging: the inflow of foreign capital has been steadily rising year to year so that FDI is better then FII Investors based in many countries have taken advantage of the India-Mauritius bilateral tax treaty to set up holding companies in Mauritius which subsequently invest in India, thus reducing their tax obligations. By industry, the largest destinations for FDI are electrical equipment (including computer software and electronics), services, telecommunication & transportation.