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Impacts of Fdi on Idustrial Dwvwlopment of Bd

In: Business and Management

Submitted By ashraful1992
Words 6167
Pages 25
1.0 Introduction

FDI refers to is a direct investment into production or business in a country by an individual or company of another country, either by buying a company in the target country or by expanding operations of an existing business in the country. Foreign Direct Investment which is a passive investment which is passive investment in the securities of another country as stock and bonds. Foreign direct investment occurs when a firm invests directly in facilities to produce and /or market a product in a foreign country.FDI plays a dominant role in the economics of Bangladesh through accelerating Gross Domestic Product(GDP),export and domestic investment followed by overall economic growth. The objective of this term paper is to find out the major effect of FDI on industrial productivity of Bangladesh. Foreign direct investment (FDI) enables a capital poor country like Bangladesh to build up capital, avoid threat to unemployment develop productive capacity. Conventional wisdoms have it that firms with foreign equity tend to be more productive. This could be due to the firm specific tangible assets such as exclusive technology and product designs, or the intangible know-how embodied in foreign equity such as marketing, networking and sourcing. Such assets may be more readily available in big multinational corporations (MNC). As such, being part of MNCs allow the local subsidiaries with foreign equity to gain access to these assets, which in turn make them to produce more output given the same level of inputs, and thus a higher level of total factor productivity (TFP) than the solely domestic owned firms. 1.1 Background Of The Study
Foreign Direct Investment is one of the vital force to boost up the economy. Industrial productivity is an pre-requisite for economic growth of a developing country like Bangladesh…...

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