2026 · Q18
Consider the following investments in an economy by a foreign company :
- 1Purchase of the ownership of a transport company
- 2Setting up a new company to produce transport equipment
- 3Acquisition of a Public Sector Unit
- 4Building a storage facility to expand the production capacity
Which of the above are examples of brownfield investments?
indian-polity-economyeconomy-fundamentals
- A1 and 2 only
- B1, 2 and 3
- C1 and 3 only
- D2, 3 and 4
Explanation
Brownfield investment means acquiring or taking over existing productive assets — as in purchasing the ownership of an existing transport company (1) or acquiring a public sector unit (3). Setting up a brand-new company (2) and building a new storage facility (4) are greenfield-type investments that create new capacity. Hence only 1 and 3 are examples of brownfield investment.