Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.
4. Examine the role played by Foreign Direct Investment in the economy of the developing countries. (250 words)
Difficulty level: Easy
Why the question: The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2022 Secure timetable.
Key Demand of the question: To write about the role played by FDI in the emerging economies.
Examine – When asked to ‘Examine’, we must investigate the topic (content words) in detail, inspect it, investigate it and establish the key facts and issues related to the topic in question. While doing so we should explain why these facts and issues are important and their implications.
Structure of the answer:
Begin by defining Foreign Direct Investment (FDI).
Write the various aspects of FDI in emerging economies – First, international flows of capital, diversification of lending and investment, global integration of capital markets, allows the transfer of technology and can also promote competition in the domestic input market etc. Substantiate with examples.
Conclude by summarising.