Government Investment

Like education, politics has converted into business. In politics, government of every country has become businessman or investor. Like businessman, it wants to return on each and every expenditure. In past, we had selfless and experienced leaders in India like Lal Bahadur Shastri whose main aim of expenditures are to do the duty of society. Now, in this commercial age, you should know what is government investment?


Government expenditures can be divided into two part, one part is for consumption for only one aim of public welfare. Other part of government expenditure which is paid for the aim of getting return that part of government expenditure is called government investment. Suppose, government has expended Rs. 100 for feeding for poor Indian, this is not government investment. But government has spent Rs. 100, 00,000 for making highway. After this, government starts to get toll tax or transport tax from public. A government expense for making highway is government investment. For commerce student, above is simple example which explains the difference between government spending and government investment, if you are asked by someone. First of all, Goverment analyzes the investment projects with capital budgeting techinques, after this which projects gives high yield, government invest in that project.

Major Ways of Government Investment

• Through financial collaborations.
• Through joint ventures and technical collaborations with MNC.
• Through capital markets.
• Invest in Infrastructure of India.