Volume : II, Issue : III, March - 2013

Trend and Pattern of FDI in the World

Dr. Joginder Singh, Dr. Narpal Singh

Abstract :

Foreign collaboration (FC)/ foreign direct investment (FDI) is channelized in the form of direct contribution to the equity capital of the company and is akin to domestic equity invested by the corporate shareholders. The major driving force for the FDI is to tap foreign markets where excess returns can be earned. In the home market, competitive pressures may be such that only a normal rate of return can be earned. Apart from penetrating into foreign markets, there are other reasons for FC/FDI: (1) production overseas may provide comparative cost advantage. (2) Investment aoad sometimes is virtual necessity to secure raw materials. (3) International diversification to reduce risk constitutes yet another significant factor for FC. Obviously, FCs/FDIs have an advantage. Firms engaged in FC/FDI are conscious of the fact that such investments are markedly different from domestic investments due to different tax laws, different treatment of foreign investments, currency fluctuations and, above all, political risk (Khan, 2005)

Keywords :

Article: Download PDF   DOI : 10.36106/ijsr  

Cite This Article:

Dr. Joginder Singh, Dr. Narpal Singh Trend and Pattern of FDI in the World International Journal of Scientific Research, Vol.II, Issue.III March 2013

Number of Downloads : 459

References :