Introduction
In a global scenario, the investments are not restricted to one’s own country. People look for opportunities across the globe. The return generated on investments changes from country to country. In a top down approach of investing, investors look for countries with high growth and then look for specific sectors in that country. When we make investments in a foreign company, we first have to evaluate all the parameters.
Why Brazil and India?
Brazil and India are one of the fastest growing economies in the world. They are now on the heat map for the investors. Also they are now making its mark in the world politically as well as financially. They are a part of BRIC which is one of the most powerful associations. Hence we selected Brazil and India for comparative study.
Objective of Study
The objective of our study is to look at various factors which an Investor looks at before investing in a country. Here we have analysed specific sectors and the problems in these countries.
Structural Issues in Brazil:
Since the mid 1990s, Brazil has enjoyed improved economic and financial stability largely owing to a strengthening of its macroeconomic framework. In order to quickly catch up with other countries, sustainable growth is required. To obtain this Brazil has to identify and deal with the structural problems it faces.

Structural Issues

Basic Logistic Infrastructure

Competitive advantages in the modern world do not only depend on the supply of assets accumulated in the past via public and private investments. They also depend on the efficiency with which the new investments contribute to the rise of the average productivity of the economy. The necessity of their continuity, the performance of regulating agencies in the areas of oil, electric energy, telecommunications, carriers, water, and ports is of greater importance in Brazil.

The Human Infrastructure

The main asset that a country possesses is its own population. Brazil has been investing in these areas as it never has in the past; in Brazil ninety-six percent of children between seven and fourteen years of age are in school. Thus the country has reached the objective of universality of basic education. The illiteracy rate declined from twelve to six percent in this period for children ages fifteen to nineteen.

Unemployment rate largely reduced due to government structural reforms, implemented over the last few years, such as an increase in the retirement age and changes in eligibility for disability pensions. Much of the extra labour supply was absorbed by government work programmes.

Inflation:
The inflation rate in Brazil was last reported at 5.8 percent in February of 2012. From 1980 until 2010, the average inflation rate in Brazil was 445.98 percent reaching an historical high of 6821.31 percent in April of 1990 and a record low of 1.65 percent in December of 1998
. If inflation and/or inflation expectations continue to rise, foreign investors could easily become nervous and quickly remove funds from Brazil. Furthermore, excessive inflation could act as a major obstacle to domestic demand and GDP growth.

World Cup:
Before the World Cup, Brazil must build the necessary stadiums and improve air and land transportation, as well as deal with the threat of water and electricity outages. Brazilian government officials are showing a lack of transparency in their failure to control costs and adhere to deadlines. A report from a government watchdog warned of the risk of mismanagement of public funds during construction.
Currency Issue:
The Plano Real (The Real Plan) was conceived as an attempt to control inflation in Brazil during the early to mid 1990’s. Inflation had been a long standing problem and was on the verge of breaking out into hyperinflation. The plan meant new controls for government spending, a process of indexation and a new currency, the Brazilian Real, which was initially pegged against the US dollar.
By floating the real, the Brazilian economy is more exposed to foreign influences. An overly strong local currency has been a structural problem for Brazil — except, of course, when the real has been too weak for the government’s comfort. A strong real makes Brazil costlier than other countries, and it is seen as diminishing the competitiveness of industry here by making its manufactured products more expensive in export markets.

Reforms Required:

Investing in infrastructure, which would be made possible by the reduction in current spending and which would bolster competitiveness and productivity.

Reducing inflation more rapidly, through tighter fiscal policy and a rebalancing of the macro policy mix.

Trade liberalisation and trade agreements should be an important part of the programme. Brazil could use its large trade surpluses to reduce the effective rate of protection and the dispersion of import duties, and particularly to cheapen the imports of capital goods. Reducing trade and current account surpluses would lessen the appreciation pressures on the BRL. Also if there is lot of dependency on China which may lead to problems.

Implementing a comprehensive labour reform, providing the economy with more suitable labour laws and institutions to suit a more dynamic and competitive, services oriented economy. Labour reforms would reduce the unit cost of labour and increase labour mobility.