Both Foreign Direct Investment (FDI) and Foreign Institutional Investor (FII) are related to investment in a country. Which one of the following statements best represents an important difference between the two?

1. Statement (A) is incorrect: Foreign Direct Investment (FDI) is often associated with bringing not just capital, but also management skills, technology, and operational control, as it implies a long-term interest and significant stake in an enterprise. Foreign Institutional Investor (FII) primarily brings capital (portfolio investment) without necessarily transferring skills or tech. 2. Statement (B) is the best representation: FII invests in financial markets (stocks, bonds), thereby increasing capital availability in general. FDI usually involves substantial investment in setting up or acquiring significant stakes in specific businesses or projects, thus targeting specific sectors with a long-term perspective. 3. Statement (C) is incorrect: FII largely operates in the secondary market but can participate in the primary market (like IPOs). FDI can involve various forms, including greenfield projects (new ventures) or acquiring substantial stakes, which isn't limited to the secondary market. 4. Statement (D) is incorrect: FDI is generally considered more stable than FII. FDI implies long-term commitment and physical presence, making disinvestment slower and more complex. FII is portfolio investment that can be liquidated and moved relatively quickly, often referred to as 'hot money', hence less stable.