CHENNAI: India is a safe destination for foreign investment as it combined prudent macroeconomic management with a stable domestic financial system, Union Minister of State for Planning V. Narayanasamy said on Sunday.
Addressing a plenary on ‘Investment Security: Ensuring Capital Flows’ on the concluding day of the Partnership Summit hosted by Confederation of Indian Industry (CII), Mr. Narayanasamy assured potential overseas investors that investment in India was “safe, secure and protected by law.”
“A striking feature of the capital flow to India in the recent period is that private (debt and equity) flows, as opposed to official flows, have become a characterised portion in the composition of total capital flows into India,” Mr. Narayanasamy said.
The capital account had been dominated by flows in the form of foreign direct investment, portfolio investments, external commercial borrowings and non-resident deposits, he said.
According to the Minister, the procedural framework for attracting the FDI was being recalibrated at State-level. The UPA government is also committed to liberalising the insurance sector despite the move hitting “a bottleneck in Parliament,” he said.
Arvin Boolell, Minister of Foreign Affairs, Regional Integration and International Trade, Mauritius, expressed fears that if multilateralism was undermined in the Doha process (WTO negotiations), it would adversely impact the Least Developing Countries (LDCs) and developing countries greatly.
He also stressed the need to address “intrinsic issues” governing intellectual property rights, fiscal space and access to agricultural markets, failing which the LDCs and developing countries would suffer.
Abdullah Ahmed Al Saleh, Director General of the UAE Ministry of Foreign Trade, noted that Asia was becoming a new economic centre of the world which comprised fast-developing nations such as India and, China.
“We need to ensure that another financial crisis [like the present one] does not recur and the way to do this is through partnerships,” he added. Pointing out that technology was opening up “new ways of entrepreneurship” and classical economies were being swiftly replaced by knowledge economies,
Mr. Saleh, however, added that “information technology was of no use if it did not have the right application.”
Chairperson of Aircel Cellular Limited Suneeta Reddy pointed out that India was looking at $500 billion worth of investment opportunities but could lose as much as $150 billion in the industrial sector owing to lack of adequate infrastructure.
Sharon Bamford, Chief Executive, U.K. India Business Council, outlined continuity, predictability and transparency as key issues for investors. In his opening remarks, V. Srinivasan, CII past president, said there had been an eight-fold increase in FDI inflow into India in the last five years.
Source : The Hindu