Question

Q.4 (a) what is political risk? Discuss the various approaches for assessment of political risk.

Answer 1

Support for scientific research and technological development, especially in developing countries, requires interstate and cross-border participation. Such development and technology transfer issues are subject not only to ethical evaluations but also to political risk assessments. The degree to which international investment projects, public and private, are attracted to or successful in many parts of the world is increasingly dependent not simply on technical but on social and political factors.

Answer 2

Political risk:

• As a result of political instability or changes, the return of an investment could suffer is called political risk or geopolitical risk.

Approaches to assess the political risk:

• Supporting scientific research and technological development involves interstate and cross-border involvement, specifically in countries which are developing. These problems of creation and technology transfer are not only susceptible to legal considerations, but also to political risk evaluations.
• In many parts of the world, the degree to which public and private international investment ventures are attracted or efficient is increasingly dependent not only on technology but also on social and political influences.

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