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Explained: Types of FDI

Explained: Types of FDI

FDI or foreign direct investment is an investment made by a foreign entity (individual or firm) into a business based in another country. The biggest difference that distinguishes between foreign direct investment and foreign portfolio investment is the notion of ‘lasting interest.’ To cement a foreign investor’s lasting interest, they are given at least 10 per cent voting rights in the business. FDI investment in India is made under two routes- automatic and approval or government. While a prior permission…

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