Foreign Direct Investment (FDI) refers to an investment made by a company or individual of one country into business interests located in another country, with the intention of establishing a lasting interest and significant degree of control over the enterprise. Unlike portfolio investment, which involves passive holdings of foreign securities, FDI implies active participation in management, decision-making, and operations. It may take the form of setting up a new subsidiary, acquiring or merging with an existing foreign firm, or expanding operations of an already established foreign business. FDI is an important component of the global business environment and plays a crucial role in economic integration among nations. One of the major advantages of FDI is capital formation. Developing countries often face shortages of domestic capital, and FDI helps bridge this gap by bringing in financial resources