Is Dividend received by a foreigner from investment in shares of an Indian company included/excluded in national income?
Is dividend received by a foreigner from investment in shares of an Indian company included/excluded in national income?
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No,
dividend received by a foreigner from investment in shares of an Indian company will not be included in the national income as it is a part of the factor income paid abroad. It is subtracted from domestic income to get national income.
Explanation:-
Dividend received by a foreigner (non-resident) from investment in shares of an Indian company earned from the domestic territory of India.
The income earned from non-residents from domestic territory for India is factor income to abroad.
It is deducted from domestic income while calculating national income.
National Income = Domestic Income + Factor income from abroad – Factor income to abroad.
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