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Essay / Research Paper Abstract
This 6 page paper looks at 2 articles concerning foreign direct investment and the way it is being influenced by political and environmental conditions. The first article discusses the way in which India is blocking foreign direct investment in tobacco, considering the causes of the decision and the potential impact of that decision. The second article looks at Iraq as a potentially viable target for long-term foreign direct investment, with the country benefiting from political and social change. The bibliography cites 2 sources.
Page Count:
6 pages (~225 words per page)
File: TS14_TEFDIindiraq.rtf
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Unformatted sample text from the term paper:
earnings foreign direct investment into tobacco products (Lamont and Yuk, 2010). The tobacco industry is a large industry in India, and India is a target for many foreign-owned cigarette and
cigar manufacturers, seeking new markets as sales decline in the Western world. Overall, the market for cigarettes in India is growing at a rate of roughly 10% per annum and
is currently the worlds largest eighth largest market (Lamont and Yuk, 2010). It is noted that foreign direct investment has never been easy in the cigarette market; following the
1998 liberalization of the tobacco sector direct investment has been allowed by foreign manufacturers subject to the company obtaining an industrial license granted by the Foreign Investment Promotion Board. The
policy change to prevent foreign direct investment into the tobacco industry is being implemented for a decision not to grant any further industrial licenses for cigarette manufacturing (Lamont and Yuk,
2010). A number of tobacco manufacturers already have interest in India, JT has a 50% ownership stake in Japan Tobacco India, BAT owns 32% of ITC and a minority
in Godfrey Philips is owned by PMI (Lamont and Yuk, 2010). The political impetuous behind the decision is the government desire to reduce smoking in India (Lamont and Yuk, 2010).
However, this has been a controversial decision, not only was cigarette manufacturers, but also with farmers. India is the third-largest producer of tobacco, and many tobacco producers are campaigning
against the decision. However, the domestic tobacco manufacturers are in favor of the move, as it helps protect their own interests in the industry by reducing competition (Lamont and Yuk,
2010). When looking at the way that foreign direct investment takes place in India over the last two decades there has been a liberalization of trade, and India has
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