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Factors Which Are Influencing Investment By Firms In India Investment is an expenditure on capital goods such as new machines, new technology and offices. Investment is an effective tool in saving your money for future. There are many options of investment with huge returns in India. Many options are also available in India regarding the different investment plans. Many investment companies offer different investment plans for all those investors who want to save their money for future. Companies like Bajaj Allianz, SBI, National Plan, Axis, offer various plans to the investors with different schemes. Many investment companies also suggest that the real estate investment is the best and safest investment option in the country. Dreamz Group Lucknow says that ‘real estate investment is the best for of investment with huge returns in today’s world.’

There are various factors influencing investment by firms in India 1. Interest rates From saving or by borrowing an investment is financed. That is the only reason investment is influenced by interest rates. Higher interest rates


always make it expensive to borrow. It also gives a better rate of return rather than keeping money in your bank. Higher opportunity cost is only due to higher interest rates because you lose out the interest payments. 2. Economic growth Economic growth is also an important factor which influences investment by firms in India. Firms invest to meet future demand and if demand falls, then firms will cut back on investment. If economy improves, then firms will definitely increase investment. 3. Confidence Investment is more risky than saving. Firms will first see the possibilities of positive future cost then only they invest in it. Keynes referred to the ‘animal spirits’ of businessmen as a key determinant of investment. Confidence will be affected by economic growth and interest rates and also the general economic climate. 4. Inflation Inflation rates in long-term can affect investment. High and variable inflation tends to create more uncertainty and confusion. If inflation is high, firms will be uncertain at the investment. They may also have fear of high inflation which could lead to economic uncertainty and future downturn. 5. Productivity of capital Another factor which is long-term changes in technology may influence the attractiveness of investment in India. New technology such as Bessemer steel and improved steam engines meant firms had a strong incentive to invest. Therefore it can be said that productivity of capital is also a major factor which influences investment. Source: https://medium.com/@ramzismith/factors-which-areinfluencing-investment-by-firms-in-india-864a415035a4

Factors Which Are Influencing Investment By Firms In India  

Many investment companies offer different investment plans for all those investors who want to save their money for future. Companies like B...

Factors Which Are Influencing Investment By Firms In India  

Many investment companies offer different investment plans for all those investors who want to save their money for future. Companies like B...

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