1.

In terms of the share in Foreign Direct Investment Equity inflows, in India during 2016 - 17, which of the following countries is on the top?1. Mauritius2. Singapore3. Japan4. U.S.A.

Answer» Correct Answer - Option 1 : Mauritius

The correct answer is Mauritius.

  • Mauritius's share in Foreign Direct Investment Equity inflows, in India during 2016 - 17, is on the top.

  • FDI in India in 2019-20
    • Singapore emerged as the largest source of FDI in India during the last fiscal with $ 14.67 billion investments.
    • It was followed by Mauritius ($ 8.24 billion), the Netherlands ($ 6.5 billion), the US ($ 4.22 billion),
    • Cayman Islands ($ 3.7 billion), Japan ($ 3.22 billion), and France ($ 1.89 billion). 

 

  • About FDI
    • ‘FDI’ or ‘Foreign Direct Investment’ means investment through capital instruments by a person resident outside India.
    • FDIs are actively utilized in open markets rather than closed markets for investors.
  • Types of FDI
    • Horizontal, vertical, and conglomerate are types of FDI’s.
    • Horizontal is establishing the same type of business in another country, while vertical is related but different, and conglomerate is an unrelated business venture. 
  • Routes through which India gets FDI
    • Automatic Route: In this, the foreign entity does not require the prior approval of the government or the RBI.
    • Government route: In this, the foreign entity has to take the approval of the government.
    • The Foreign Investment Facilitation Portal (FIFP) facilitates the single window clearance of applications which are through approval route.
  • Entities that can invite FDI in India
    • Partnership Firm
    • Proprietary Concern
    • Trusts
    • Limited Liability Partnerships (LLPs)
    • Investment Vehicle
    • Startup Companies
  • Sectors in which FDI is prohibited:
    • Lottery Business including Government/private lottery, online lotteries, etc.
    • Gambling and Betting including casinos etc.
    • Chit funds
    • Nidhi company
    • Trading in Transferable Development Rights (TDRs)
    • Real Estate Business or Construction of Farm Houses
    • Manufacturing of cigars, cheroots, cigarillos, and cigarettes, of tobacco or of tobacco substitutes.

  • FDI in India in 2019-20
    • Singapore emerged as the largest source of FDI in India during the last fiscal with $ 14.67 billion investments.
    • It was followed by Mauritius ($ 8.24 billion), the Netherlands ($ 6.5 billion), the US ($ 4.22 billion),
    • Cayman Islands ($ 3.7 billion), Japan ($ 3.22 billion), and France ($ 1.89 billion). 


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