[Economy Q] FDI and FII difference & which one is better?

In crude terms: FII= when foreign-players invest in shares and stockmarket. FDI= when foreign companies invest in India for manufacturing, production, sales etc. by themselves (100%) or by partnering with some Indian firms. FII players pull out their money from stock-market even for slightest good/bad r umors and invest in in different country. That s why it s called Hot money -was responsible for 1997 Asian financial crisis {2 m arker in GS Mains Paper-I, 2007} In 2007, the 2 marker appeared because that year SEBI made some regulation in FI I investment via participatory notes to control the hot-money. Also, there were allegations that Pakistan might use it for financial-terrorism us ing FII via Participatory notes. Although there are tools such as Tobin Tax, to control the flight of hot-money. But still, For development, Governments want and prefer FDI and not FII. Because It s hard to pull out FDI once invested.