UPSC PYQPrelims 2021

Civil Services Examination · Question 7

Consider the following: 1. Foreign currency convertible bonds 2. Foreign institutional investment with certain conditions 3. Global depository receipts 4. Non-resident external deposits Which of the above can be included in Foreign Direct Investments?

  1. 1, 2 and 3
  2. 3 only
  3. 2 and 4
  4. 1 and 4
Show answer & explanation

Answer: (A) 1, 2 and 3

Explanation

FCCBs, GDRs and FII investment above the 10% threshold can count as FDI. NRE deposits are bank deposits, not investment in enterprises.