SUBMITTED TO:

SUBMITED BY: PROF. SATISH PAWAR

BHUMIKA SHRIVASTAVA DIVYA SONI PRIYESH PALIWAL

FDI: FOREIGN DIRECT INVESTMENT

OBJECTIVES OF RESEARCH:
TO FIND OUT THE EFFECT OF FDI ON DIFFERENT COUNTRIES. THE RESEARCH WILL COVER FOLLOWING POINTS: POLITICAL IMPACT ECONOMIC CHANGES:BEFORE AND AFTER SOCIAL CHANGES:REACTION OF RETAILERS AND PUBLIC OF THE NATION. TECHNOLOGICAL CHANGES

DEFINING RESEARCH PROBLEM:

TO MAKE A COMPARATIVE STUDY OF DIFFERENT COUNTRIES AND FIND OUT THE IMPACT OF FDI ON EACH ONE OF THEM.

HYPOTHESIS

The overall effects of inward FDI on the host country are positive, but the benefits are not evenly spread over the host-country population.

INTRODUCTION
WHAT IS FDI??? Foreign direct investment, in its classic definition, is defined as a company from one country making a physical investment into building a factory in another country. Foreign direct investment (FDI) plays an extraordinary and growing role in global business. It can provide a firm with new markets and marketing channels, cheaper production facilities, access to new technology, products, skills and financing. During the past 15 years, the importance of FDI in the world economy has increased rapidly. The total stock of FDI increased from 8% of world GDP in 1990 to 26% in 2006.

THE SOCIAL IMPACT OF FOREIGN DIRECT INVESTMENT The positive impact of FDI resides primarily in better job opportunities for new employees, rather than better pay for workers who stay in firms that happen to change ownership.

SINGAPORE

FDI IN SINGAPORE
Government of Singapore adopted open door policy since 1965. Economy growth is 409.7% till 2011 and GDP growth by 2.4% year on year. Socially it was accepted very well. Strong TNCs can inhibit local companies from deepening their technological capabilities. Sectors: manufacturing, finance, hotels and restaurants.

BELGIUM

FDI IN BELGIUM
They have wide open door policy from 1960. Their economy growth is 49.5% in 2011 and GDP growth by 4.4% Helps people to grow their small business. Largest three home-based TNCs Sectors: petroleum, chemicals and diamonds.

AUSTRALIA

FDI IN AUSTRALIA
As a large, resource rich country with relatively high demand for capital,Australia has, for over two centuries, relied on foreign investment to meet the shortfall of domestic savings against domestic investment needs. Foreign capital has allowed the Australian people to enjoy higher rates of economic growth,employment and a higher standard of living than could have been achieved from domestic savings alone.

The Governments objectives for the reviews of foreign investment policy were to rationalise regulation within the existing Act, reduce compliance costs for business and streamline administrative procedures. Over the last five years, inward FDI stock has increased by an average of 5.8 per cent per annum. In 1975 the Government announced its formalised foreign investment policy.

In 1975 the Government announced its formalised foreign investment policy. The ratio of FDI to GDP is almost 36 per cent which is well above the average for comparable developed economies of 25 per cent. As of 30 July 2010, the stock of inward FDI in Australia was A$436 billion.

JAPAN

FDI IN JAPAN
Japan witnessed major FDI flows since the 1990s. The FDI figures for the time period 1990 to1996 stood at around $1 billion yearly, on an average. This figure climbed to $3 billion in 1997 and further stood at $12.7 billion for the year 1999. FDI has a large and positive effect on trade, there is a greater degree of vertical specialization and fragmentation.

FDI IN GERMANY
German FDI activities are concentrated in the services sector (71%),mainly in the financial intermediation sector (37%). In the case of German FDI, the strong links with developed economies and the mutual interrelationships at the same sectoral level indicate that market access and distribution are the predominant motives, and not pure cost saving

BIBLIOGRAPHY:

www.economywatch.com www.bundesbank.de www.oecd.org www.austrade.gov.au www.prnsewswire.com www.icrier.com www.imes.boj.or.jp www.treasury.gov.au www.business.nsw.gov.au

CONCLUSION

FDI Advantages Vs Disadvantages

ADVANTAGES:

Inflow of equipment & technology Competitive advantage & innovation Financial resources for expansion Employment generation Contribution to exports growth investor Access to global marketplace for domestic Access to low cost resources for investor material/ wages Access to new market/distribution channel for products Improved consumer welfare through socio cultural effect reduced costs, wider choice and improved .

DISADVANTAGES: Crowding of local industry Loss of control Repatriation of profits/dividends by investors. Conflicts of codes/laws players Possible exploitation of resourcesmaterial/wages. Effect on local culture/sentiments socio cultural effect Effect on natural environment quality

THANKYOU

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