FDI in the Infrastructure Sector

Description: This quiz will test your knowledge on Foreign Direct Investment (FDI) in the Infrastructure Sector in India.
Number of Questions: 15
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Tags: fdi infrastructure indian economy
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Which sector within the infrastructure sector has received the highest FDI inflows in India?

  1. Power

  2. Telecommunications

  3. Transportation

  4. Water and Sanitation


Correct Option: A
Explanation:

The power sector has consistently attracted the highest FDI inflows among infrastructure sub-sectors in India.

What is the primary objective of the Indian government in promoting FDI in the infrastructure sector?

  1. To increase employment opportunities

  2. To improve the quality of infrastructure

  3. To reduce the fiscal deficit

  4. To attract foreign currency


Correct Option: B
Explanation:

The Indian government aims to improve the quality and efficiency of infrastructure services by attracting FDI.

Which country has been the largest source of FDI in the infrastructure sector in India?

  1. United States

  2. United Kingdom

  3. Singapore

  4. Japan


Correct Option: C
Explanation:

Singapore has been the largest source of FDI in the infrastructure sector in India, followed by Mauritius and Japan.

What is the minimum FDI limit for projects in the infrastructure sector in India?

  1. 10%

  2. 25%

  3. 50%

  4. 75%


Correct Option: A
Explanation:

The minimum FDI limit for projects in the infrastructure sector in India is 10%.

Which government agency is responsible for approving FDI proposals in the infrastructure sector in India?

  1. Reserve Bank of India (RBI)

  2. Foreign Investment Promotion Board (FIPB)

  3. Ministry of Finance

  4. Department of Industrial Policy and Promotion (DIPP)


Correct Option: D
Explanation:

The Department of Industrial Policy and Promotion (DIPP) is responsible for approving FDI proposals in the infrastructure sector in India.

What are the major challenges faced by FDI in the infrastructure sector in India?

  1. Lack of clarity in regulatory policies

  2. Delays in project approvals

  3. Land acquisition issues

  4. High cost of capital


Correct Option:
Explanation:

FDI in the infrastructure sector in India faces challenges such as lack of clarity in regulatory policies, delays in project approvals, land acquisition issues, and high cost of capital.

Which sector within the infrastructure sector is expected to witness the highest growth in FDI inflows in the coming years?

  1. Renewable energy

  2. Urban infrastructure

  3. Transportation

  4. Water and Sanitation


Correct Option: A
Explanation:

Renewable energy is expected to witness the highest growth in FDI inflows in the coming years due to India's ambitious clean energy targets.

What are the benefits of FDI in the infrastructure sector for India?

  1. Increased employment opportunities

  2. Improved quality of infrastructure

  3. Access to advanced technologies

  4. Increased foreign exchange reserves


Correct Option:
Explanation:

FDI in the infrastructure sector benefits India by creating employment opportunities, improving the quality of infrastructure, providing access to advanced technologies, and increasing foreign exchange reserves.

How does FDI in the infrastructure sector contribute to India's economic growth?

  1. It increases the productive capacity of the economy

  2. It improves the efficiency of resource allocation

  3. It promotes technological innovation

  4. All of the above


Correct Option: D
Explanation:

FDI in the infrastructure sector contributes to India's economic growth by increasing the productive capacity of the economy, improving the efficiency of resource allocation, and promoting technological innovation.

What are the potential risks associated with FDI in the infrastructure sector in India?

  1. Loss of control over strategic assets

  2. Environmental degradation

  3. Exploitation of labor

  4. All of the above


Correct Option: D
Explanation:

FDI in the infrastructure sector in India carries potential risks such as loss of control over strategic assets, environmental degradation, and exploitation of labor.

How does the Indian government mitigate the risks associated with FDI in the infrastructure sector?

  1. By implementing strict regulatory policies

  2. By promoting transparency and accountability

  3. By encouraging local participation

  4. All of the above


Correct Option: D
Explanation:

The Indian government mitigates the risks associated with FDI in the infrastructure sector by implementing strict regulatory policies, promoting transparency and accountability, and encouraging local participation.

What are the future prospects for FDI in the infrastructure sector in India?

  1. FDI inflows are expected to increase in the coming years

  2. The government is committed to attracting more FDI

  3. There are several untapped opportunities for FDI in the infrastructure sector

  4. All of the above


Correct Option: D
Explanation:

The future prospects for FDI in the infrastructure sector in India are positive, with expected increases in FDI inflows, government commitment to attracting more FDI, and untapped opportunities for investment.

How does FDI in the infrastructure sector contribute to sustainable development in India?

  1. It helps create jobs and boost economic growth

  2. It improves access to essential services like electricity and transportation

  3. It promotes the use of clean and renewable energy sources

  4. All of the above


Correct Option: D
Explanation:

FDI in the infrastructure sector contributes to sustainable development in India by creating jobs and boosting economic growth, improving access to essential services, and promoting the use of clean and renewable energy sources.

What are some of the key policy initiatives taken by the Indian government to attract FDI in the infrastructure sector?

  1. Relaxation of FDI norms

  2. Streamlining the approval process

  3. Providing incentives and subsidies

  4. All of the above


Correct Option: D
Explanation:

The Indian government has taken several policy initiatives to attract FDI in the infrastructure sector, including relaxation of FDI norms, streamlining the approval process, and providing incentives and subsidies.

How does FDI in the infrastructure sector contribute to India's overall economic competitiveness?

  1. It improves the quality and efficiency of infrastructure

  2. It reduces the cost of doing business

  3. It enhances productivity and innovation

  4. All of the above


Correct Option: D
Explanation:

FDI in the infrastructure sector contributes to India's overall economic competitiveness by improving the quality and efficiency of infrastructure, reducing the cost of doing business, and enhancing productivity and innovation.

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