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This study establishes the importance of foreign investment, for total capital formation and for the performance of specific sectors. It identifies peculiarities of foreign investors - whether they were export oriented, whether they used capital-intensive methods and paid high wages. It describes government incentives for investment and for foreign investment in particular. It explores the motives for foreign investment, checking for the relative importance of markets (local and export), cost factor, incentives, skills and socio-political factors. It also presents an estimate of foreign investment requirements for 1984-88 and some observations on the results so far.