Analysis of Most Influential Factors To Attract Foreign Direct Investment

Abstract

Foreign Direct Investment is known as investment from a country to another country. In this globalization age it is so demandable in the field of business and economy. Through the FDI international business and economic relation can be stronger between two or more countries. FDI is mostly popular in developing countries. It helps to become develop countries and to make stronger relationship with developing countries. Through this study we able to know that what is FDI, mode of FDI, types of FDI for the better understanding about FDI. We have also known that, global trend of FDI, position of different countries as FDI host country and Investor country. There are some countries like China, India, Malaysia they have strong position as FDI receiving country. In other hand country like USA, Japan, Germany they have strong position as FDI investor country in the world. We have also studied about the role of FDI in economical development especially in develop countries. In develop countries FDI working like a blood of economy to make that country active and economically successful. Almost all develop countries of every region of the world depend on FDI for faster economical development. There are some advantages and disadvantages of FDI for every country. So many influential factors are exist in FDI to attract the foreign investor. In this study we have tried to sort it out from different data sources. There are some case studies to understand the position of FDI. How it happens, what are the influential factors, how multinational companies started their business operation in a new country through FDI. What types of challenges they have faced and how they solved that. In this study reviled that, FDI is very much important for global economy. Developing countries is always expecting FDI from develop countries. In that case some factors are highly influenced to take the decision for investment. Political stability, lower wages rate, lower production cost, easy communication, good exchange rate, host country‟s policy about foreign investment etc are the influential factors to attract the foreign investor. So if we would like to welcome the investor and to increase our FDI we have to focus on this issues and we have make these attractive for the investors.

Keywords: Foreign Direct Investment, Developing countries