Why in the discussion?
According to the recent World Investment Report 2019, issued by the United Nations Conference on Trade and Development (UNCTAD) on Trade and Development, in 2018, India’s foreign direct investment of approximately $ 42 billion Investment (Foreign Direct Investments-FDI) was mainly received in manufacturing, communication and financial sectors. The inflow of foreign direct investment of India has increased by about 6 percent.
In 2018, India received 77 percent of total foreign direct investment in the South Asian region.
It has been said in the report that the prospects of foreign direct investment in South Asia depend mainly on investment in India.
According to the report, the main reason for the increase in FDI in India was cross-border merger and acquisitions – M & AS. Significantly, India registered an increase of about 44 percent compared to the year 2017 investment.
The acquisition of Flipkart, India’s largest e-commerce company by Walmart, was the biggest event in the context of mergers and acquisitions across the border and in terms of direct foreign investment.
Other South Asian countries like Bangladesh and Sri Lanka also saw foreign direct investment of $ 3.6 billion and $ 1.6 billion respectively.
In the developing countries of Asia, about 3.9 percent growth was recorded last year.
It has also been highlighted in the report that around 5400 special economic zones exist in the world and out of which about 4000 special economic zones are in developing countries of Asia.
The first place in the list of special economic zones in Asia is China, which has a total of 2543 special economic zones,
After this, the location of the Philippines and India, which has 528 and 373 special economic zones, respectively.
Development of new special economic zones also promotes investment activities, which are particularly reflected in industrial establishments and power generation. The number of special economic zones in South Asia is going to increase substantially in the coming years.
Foreign Direct Investment (FDI)
This is an investment made by a group with the intention of establishing endowments in the business or corporation of one country.
Foreign Direct Investment (FDI) is a key driver of economic development and an important source of non-debt financing for economic development in the country.
With FDI, new capital comes in the domestic economy, new technology and employment opportunities increase.
United Nations Conference on Trade and Development (UNCTAD)
Founded in 1964, the United Nations Conference on Trade and Development (UNCTAD) encourages the integration of developing countries in the global economy.
This is a permanent intergovernmental body.
Its headquarters is in Geneva, Switzerland.
Some major reports published by:
Trade and Development Report
World Investment Report
The Least Developed Countrie Report
Information and Economy Report
Technology and Innovation Report
Commodities and Development Report
Special Economic Zones – SEZ
Special Economic Zones or SEZs are specifically defined for the geographical area, where trade, economic activity, production and other business activities are operated.
These areas are developed to encourage business activities by keeping in mind special economic rules and regulations within the country’s borders.
India is one of the top countries which have established such geographical units in particular to promote industry and business activities.
India is the first Asian country to set up a special area in Kandla in 1965 to increase exports. It was named Export Processing Zone (EPZ).