MARKET UPDATE
| Pranab seeks U.S. investments to improve infrastructure Tue, 09 Nov 2010 |
| The Hindu Pranab seeks U.S. investments to improve infrastructure Union Finance Minister Pranab Mukherjee on Monday invited U.S. investments for developing infrastructure as the lack of quality facilities stood in the way of high growth. Speaking at a conference, ‘India-U.S.: An Agenda for Co-creation', organised by the Confederation of Indian Industry here, Mr. Mukherjee pointed out that developing infrastructure for achieving higher growth provided huge investment opportunities. India, Mr. Mukherjee said, offered exciting opportunities in various core sectors such as power, roads and ports. “India presents exciting opportunity for global investors. The recovery of the benchmark market indices of India over the last two years has been quite rapid and supports this assessment.” In fact, it was the fast economic growth in recent years that tended to put an increasing stress on the country's physical infrastructure and sectors such as electricity, railway, road, ports, airports, irrigation, urban and rural water supply and sanitation. Alongside, the Finance Minister noted that despite the decline in capital flows globally, foreign direct investment (FDI) inflows into India had been quite robust during the last two years. However, greater funds from the private sector would be essential to sustain the high growth envisaged in infrastructure spending. “The extent of foreign participation — both through debt and equity — in the financing of India's infrastructure has been of the order of the 8-10 per cent in the recent past. Going forward, I expect a much greater degree of involvement of foreign investors in this sector,” Mr. Mukherjee said. For U.S. companies, Mr. Mukherjee said, it was the challenge of financial inclusion in India that provided an opportunity. “Financial inclusion is a key determinant of sustainable and inclusive growth. There are several areas where U.S. companies can play a role in delivering financial inclusion.” Financial reforms During another session at the conference, U.S. Treasury Secretary Timothy Geithner pointed out India should further liberalise and usher in financial sector reforms to sustain the 8-9 per cent growth that it was posting during the pre-crisis period. “You have been growing pre-crisis at 8-9 per cent. It seems it could be achievable that you sustain a growth over a period of time. It is going to require more reforms in the financial sector,” he |
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