MNCs upbeat about India as investment destination

Friday, 30 May 2003, 19:30 IST
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NEW DELHI: Despite hiccups, India is considered a good investment destination by multinationals, an annual survey by a leading industry lobby has revealed. While 40 percent of 135 respondents perceived India as a good destination, another 44 percent were neutral and just 16 percent expressed reservations, Yogendra Modi, senior vice president of the Federation of Indian Chambers of Commerce and Industry (FICCI), told reporters here Thursday. MNCs like Nestle, Hyundai, Ford, DuPont and Reebok had expressed reservations about India mainly on account of poor infrastructure and bureaucratic red tape, Modi said. Almost three-fourths of the companies felt government efforts to attract foreign direct investment (FDI) were "average to good". Over 60 percent of the respondents in the survey reported making profits in their Indian operations while nine were breaking even. Availability of skilled manpower was the one count on which MNCs placed India ahead of China as an attractive investment destination. On a comparative scale, however, investors perceived India to be far behind countries like China, Malaysia and Thailand. "India's commendable performance on the growth front has not gone unnoticed" but "consumer purchasing power and infrastructure stand out as the most worrying factors for India", the report stated. India has been witnessing a rise in FDI inflow despite an uncertain global scenario. As against $3.9 billion worth FDI inflow in 2001-02, India witnessed a 40 percent rise in foreign investments flow to $5.4 billion in 2002-03. While consumer goods, IT and related services, chemicals and automobiles are seen as good sectors for investment, in terms of destination Maharashtra topped followed by Andhra Pradesh jumping one slot to second place and displacing Karnataka. Both Tamil Nadu and Gujarat have retained their previous slots to be among the top five investment destinations in the country.
Source: IANS
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