What Is Foreign Direct Investment? Explain With Example.........

Foreign Direct Investment or FDI is the investment in a country by some foreign country. It is usually a physical investment like building a factory or an office. It usually includes a parent company, who in the effort of expanding establishes its office as a permanent company in a foreign country. In this way the parent company gets the level of Multinational company and its investment is known as FDI for the host country. Importance of expansion is very necessary for all nature of businesses to sustain long term survival but FDI is very important for the host country as well. For example, developing countries are the most attractive growing markets for almost all kinds of businesses therefore, if a company makes FDI in  developing country then it will give benefit to the company and the country both. Benefits usually increase high profits for the company, and increase in employment, economic growth etc. For the country. In addition to that there are a number of risks which are always there in FDI for both the country and the company.