Macro-Parameters for Project Selection:
The selection of a project should fit in with the environment and the considerations for such selection include:
- Permissibility of such a project in the:
- Existing legal and social condition;
- Government policies relevant to such project;
- Prevalent situation within the relevant industry including over-all market size with its growth and envisaged market share;
- Foreign participation, foreign know-how and the liability to pay the foreign partner, as such;
- Availability of funds from the Financial Institutions on top of the organization’s own equity participation and the condition of the capital market;
- Opportunity for employment (with productivity);
- Overall benefits for a specific project like export-oriented units (EOUs) or projects within export processing zones (EPZs).
- Foreign participation with terms of ‘buy-back’;
- Tax concessions relevant to such project;
- Government subsidies relevant to such project, such locations planned;
- Strength and weaknesses of the competitors in the industry relevant to such project.
Micro-Parameters for Project Selection:
The considerations within the micro-parameters for the selection of the project the project owner (once the proposed project is favourable within the macro-parameters) should include:
- The need of the organisation for such a project. The basic objectives should be directed towards solving the problems or availing of certain opportunities for investments as per the need.
- The necessary resources should be available to the organisation, selecting such project including:
- The initial fund for investment;
- The organizational strength to implement and run the project;
- The required technical know-how;
- Sourcing of the basic inputs like raw materials, utilities.
- The economic viability of such a project