Which of the following factors can be counted for smaller number of foreign banks in India? 1. Differentiated banking 2. Public Sector Lending 3. Wholly owned subsidiaries 4. Longer Gestation Period

The correct answer is: C. 1, 2 and 4

Differentiated banking refers to the practice of banks offering different products and services to different customer segments. This can make it difficult for foreign banks to compete with domestic banks, which are often better established in the Indian market.

Public sector lending refers to the practice of the Indian government lending money to public sector banks. This can give public sector banks an advantage over private sector banks, including foreign banks, which may not have access to the same level of government support.

Longer gestation

period refers to the fact that it can take longer for foreign banks to establish themselves in the Indian market. This is due to a number of factors, including the need to build up a customer base, understand the Indian regulatory environment, and compete with well-established domestic banks.

Option 1: Differentiated banking can make it difficult for foreign banks to compete with domestic banks, which are often better established in the Indian market. For example, domestic banks may have a larger customer base and a better understanding of the Indian regulatory environment.

Option 2: Public sector lending can give public sector banks an advantage over private sector banks, including foreign banks, which may not have access to the same level of government support. For example, public sector banks may be able to borrow money at lower interest rates than private sector banks.

Option 3: Longer gestation period refers to the fact that it can take longer for foreign banks to establish themselves in the Indian market. This is due to a number of factors, including the need to build up a customer base, understand the Indian regulatory environment, and compete with well-established domestic banks. For example, foreign banks may need to spend more time and money on marketing and advertising in order to attract customers.

Option 4: Longer gestation period can also make it more difficult for foreign banks to make a profit in the Indian market. This is because it can take longer for foreign banks to build up a customer base and generate enough revenue to cover their costs.