India seeks to attract Saudi investments

India is projected to be the second fastest growing economy in the world with a growth rate of 6.9 percent, which makes it an "incredible investment destination." "What makes it, in fact, incredible further is the Indian government's commitment to usher in financial sector reforms," said Indian Ambassador Hamid Ali Rao, while speaking during a business meeting organized on the occasion of the visit of an Indian economic delegation, here on Monday.
The economic delegation headed by R. Gopalan, secretary (economic relations) at the India's Ministry of Finance interacted with Saudi and Indian businessmen at the meeting that was organized to promote investments in India. Aditya Gaiha, deputy general manager of Reserve Bank of India, was also in the delegation, which was composed of several other top officials from the Ministry of Finance, Reserve Bank of India, Securities and Exchange Board of India and Department of Revenue.
Speaking on this occasion, Ambassador Rao gave detailed information about the incentives given by India to foreign investors. He said "India has taken a number of initiatives to make the investment climate conducive to all classes of investors." The Indian capital markets have undergone a paradigm shift in the last two decades, offering unprecedented prospects for global investors and business, he added.
"The most recent scheme of allowing Qualified Foreign Investors (QFIs) to invest in Indian equity, mutual funds and corporate bonds have evoked great interest in the Gulf region as well," said the envoy, adding that the presentations in this conference have shed more light on these initiatives. He also recalled the linkages between India and Saudi Arabia go back in time to several centuries.
He said that Indo-Saudi relations received fresh impetus in recent years through "two very important state-level visits: The visit of Custodian of the Two Holy Mosques King Abdullah to India in 2006 followed by the visit of Prime Minister Manmohan Singh to Saudi Arabia in 2010."
Rao pointed out that the bilateral trade has been rising strongly. In 2010-11, it was over $25 billion, making Saudi Arabia the 4th largest partner for India in terms of trade, he added. He said that India and Saudi Arabia have also established a number of institutional mechanisms for bilateral economic cooperation. These include the Saudi-India Joint Business Council; the Indo-Saudi Joint Commission Meetings; the Joint Working Groups, etc.
Referring to the visit of Indian economic mission, which will help to present India as an ideal investment destination, he said that the delegation headed by Gopalan will go a long way in acquainting India with Saudis and presenting India as an investors' friendly destination. He said that the macroeconomic fundamentals of the Indian economy are very resilient and less vulnerable to external shocks.
Despite an adverse international economic environment, the Indian economy grew by about 7 percent in 2011-12, which is amongst the highest in the world, he noted.
Later addressing a press conference, Gopalan gave details about the changes in regulatory provisions made by India to attract foreign investment. He said that New Delhi would require one trillion dollars of investment for its infrastructure projects during the next five years on attractive terms and conditions. "Out of one trillion dollars, we aim to raise about $500 billion from private investors," he added.
Asked about the growth of Indian economy, he said "we are aiming for seven percent growth during 2012-3013." "About nine big issues are also planned so far as stock markets are concerned," said Gopalan, while referring to the liberalization of economy, which is still continuing. "India is growing on all fronts," said RBI deputy chief Gaiha, adding that the RBI has made necessary changes to regulatory provisions to make the economy more liberal and competitive.
He said that the Indian government has taken a number of initiatives aimed at attracting higher foreign investment in India. "We attracted some $46 billion as FDI during 2011-12 financial year," said Gaiha.