Apart from The Usual delays on Second Generation reforms, The Indian Government is far from Positioning itself as investor friendly, as The Cases of Cairn and POSCO prove,
In the real world, principles or established beliefs have to also be viewed with respect to how expensive it is to abide by them. India abided by a certain set of principles before 1991, and they cost the nation decades of economic prosperity. But the balance of payments crisis compelled the country to begin to embrace a free market economy against the conventional mindset. In retrospect, of course, the crisis was the greatest boon in the history of independent India.
As India faces the prospect of a serious drop in GDP growth rates again after the global recessionary phase, the incredibly slow pace of second generation reforms in areas like infrastructure, cost of capital and labour reforms has seriously hurt business sentiment. Besides, there is a raging debate on opening up sectors like multi-brand retail, financial services, defence, et al to FDI, where policy makers again mull over how such a decision may affect the economy and the masses. Questions on the government’s tardiness with respect to opening up FDI could get even more discomfitting if the financial situation worsens.
Recent data on FDI is indicative of aa negative sentiment, as the FDI for FY 2010-11 stood at $27.02 billion, which was an alarming drop of around 28.4% yoy (figures from the Department of Industrial Policy & Promotion). It is not like India was breaking any records in the past few years either. FDI remained relatively static at $37.76 billion in FY 2009-10 compared to $37.84 billion in FY 2008-09, which, in turn, was a growth of around 8.64% over the previous year.
Also, take a look at the countries contributing FDI in terms of equity inflows. The leading contributor is Mauritius, which contributed $6.98 billion or 35.9% to the total inflows of $19.43 billion for FY 2010-11. This was followed by Singapore at $1.7 billion or 8.7% and US at $1.17 billion or 6%. This unique group of nations contributed nearly 50% of total investment. Mauritius is a haven for FIIs, as India has a Double Taxation Avoidance Agreement with that country. But why does FDI still shy away from Incredible India so overwhelmingly?
In the real world, principles or established beliefs have to also be viewed with respect to how expensive it is to abide by them. India abided by a certain set of principles before 1991, and they cost the nation decades of economic prosperity. But the balance of payments crisis compelled the country to begin to embrace a free market economy against the conventional mindset. In retrospect, of course, the crisis was the greatest boon in the history of independent India.
As India faces the prospect of a serious drop in GDP growth rates again after the global recessionary phase, the incredibly slow pace of second generation reforms in areas like infrastructure, cost of capital and labour reforms has seriously hurt business sentiment. Besides, there is a raging debate on opening up sectors like multi-brand retail, financial services, defence, et al to FDI, where policy makers again mull over how such a decision may affect the economy and the masses. Questions on the government’s tardiness with respect to opening up FDI could get even more discomfitting if the financial situation worsens.
Recent data on FDI is indicative of aa negative sentiment, as the FDI for FY 2010-11 stood at $27.02 billion, which was an alarming drop of around 28.4% yoy (figures from the Department of Industrial Policy & Promotion). It is not like India was breaking any records in the past few years either. FDI remained relatively static at $37.76 billion in FY 2009-10 compared to $37.84 billion in FY 2008-09, which, in turn, was a growth of around 8.64% over the previous year.
Also, take a look at the countries contributing FDI in terms of equity inflows. The leading contributor is Mauritius, which contributed $6.98 billion or 35.9% to the total inflows of $19.43 billion for FY 2010-11. This was followed by Singapore at $1.7 billion or 8.7% and US at $1.17 billion or 6%. This unique group of nations contributed nearly 50% of total investment. Mauritius is a haven for FIIs, as India has a Double Taxation Avoidance Agreement with that country. But why does FDI still shy away from Incredible India so overwhelmingly?
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Ranked 1st in International Exposure (ahead of all the IIMs)
Ranked 6th Overall
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri’s Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM’s Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
IIPM : The B-School with a Human Face
IIPM – FLP (Flexi Learning Program)
