Question

How is the Government of India trying to attract more foreign investment? Explain with examples.(All India - 2013)

Answer 1

Answer:

The government try to attract more foreign investment for the following reasons:

foreign investments create new job opportunities in the country.

this is not only provides finance but managerial and technical personal and new technology in production also.

this encourages local enterprises to invest more in subsidiary services like Transport and training agents and in collaboration with foreign enterprises .

the social returns are greater than the private returns on foreign investment.

the government's get revenue when it taxes on profits of foreign firms or gets royalties from concession report.

Answer 2

Governments try to attract foreign investment because it helps to create more job opportunities in a country, directly as well as indirectly in service sector. We can gain additional taxes by taxing the profits made by foreign investments.