[Economy Q] How Foreign Direct Investment (FDI) would influence the Economy
Tell me how FDI would influence the Economy in a simple language as I am new to Economics Please.
Suppose Foreign Direct Investment (FDI) is allowed in multi-brand retail sector then Wall mart can come to India and start a big mall in every city.
- So lot of laborers, contractors, cement suppliers, masons, electricians etc get work for mall-construction.
- After mall starts running: people get jobs as salesmen, accountant, manager, security guard and sweeper in it.
- Since competition increases, consumers get more choices and attractive price offers by competing malls & small vendors.
- All these people who got job because of this mall, now they've money in their hands so they go take home and bike loans, so it increases the demand and thus people in those automobile-real estate sectors also get more orders.
- new houses are built so more laborers get jobs and that goes on and on...
Thus it helps economy.
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