Business Daily from THE HINDU group of publications
Monday, Aug 25, 2008
ePaper | Mobile/PDA Version | Audio
Business Daily from THE HINDU group of publications Monday, Aug 25, 2008 ePaper | Mobile/PDA Version | Audio |
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Foreign Direct Investment Industry & Economy - Foreign Trade Columns - For the Asking Which is better, FDI or foreign trade? Which one is preferable by a developing country — foreign trade or FDI? Suchet Rao, New DelhiReams have been written on this issue. Suffice it to say that as a rule of thumb, developing nations stand more to gain through FDI (foreign direct investment) and developed ones more through international trade. Which is why at the WTO, developed nations are driving the developing ones hard. China, for example, could become a big exporter only after wooing and getting FDI. Indeed FDI has multiplier effects — foreign exchange, employment, infrastructure, etc., all get a boost in its wake. India could also do with a lot more FDI. A developing nation starved of FDI would find its BoP (balance of payments) steadily deteriorating if it is driven to international trade as an alternative because history shows that value-added items get a better price than raw materials that they are destined to export. S. MURLIDHARAN More Stories on : Foreign Direct Investment | Foreign Trade | For the Asking
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