What is the primary difference between Foreign Direct Investment (FDI) and Foreign Portfolio Investment (FPI)?

FDI involves investing in physical assets, while FPI focuses on financial assets. FDI is short-term, while FPI is long-term. FDI offers high control over investments, while FPI offers low control. FDI is primarily undertaken by individuals, while FPI is favored by institutions.

Which of the following is an example of Foreign Direct Investment (FDI) in India?

Purchasing shares of an Indian company listed on the stock exchange. Investing in Indian government bonds. Setting up a manufacturing plant in India. Buying mutual funds that invest in Indian companies.

Why is Foreign Direct Investment (FDI) generally considered more favorable than Foreign Portfolio Investment (FPI) for a country's economy?

FDI involves higher investment amounts, leading to greater capital inflow. FDI demonstrates a long-term commitment to the host country's economy. FDI often brings in technological expertise and resources. All of the above.

What has been the recent trend of Foreign Portfolio Investment (FPI) in India?

Significant increase in FPI inflows into the Indian stock market. Steady growth of FPI investments in Indian debt instruments. Persistent outflow of FPI from Indian equities due to global economic factors. Increased preference for FPI in stable markets over emerging markets.

Which of the following initiatives by the Indian government aims to attract more Foreign Direct Investment (FDI)?

Restricting foreign investment in key sectors like defense and oil refineries. Tightening FDI norms across various industries. Relaxing FDI regulations in sectors like defense, telecom, and power. Encouraging short-term portfolio investments over long-term direct investments.