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May 2, 2001
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Money > Business Headlines > Report May 2, 2001 |
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Transport industry attracts highest FDI: AssochamTransport, telecom and services are among the six sectors that have attracted 30 per cent of Rs 856.15 billion worth of foreign direct investment in India in the post-liberalisation period. The other three sectors are electrical equipment and chemicals, and total FDI accounted for by the six sectors amounted to Rs 251.68 billion. An analysis on FDI trends carried out by the Associated Chambers of Commerce and Industry of India reveals that the largest recipient of FDI was the transport industry which received Rs 62.36 billion from August 1991 to October 2000, followed by electrical equipment (Rs 57.65 billion), chemicals (Rs 44.06 billion), telecommunications (Rs 43.33 billion), services sector (Rs 42.25 billion) and fuels (Rs 41.12 billion). The other sectors which received FDI of over Rs 5 billion during the period were food processing industries (Rs 25.69 billion), paper and pulp, including paper products (Rs 11.26 billion), mechanical and engineering items (Rs 8.78 billion), textiles (Rs 8.37 billion), trading (Rs 7.84 billion), metallurgical industries (Rs 6.95 billion) and glass (Rs 6.59 billion. However, several sectors registered decline in FDI inflows during the last three years, including boilers and steam generating plants, prime movers, machine tools, earthmoving machinery, medical and surgical, and rubber goods. In this context, the chamber has suggested that the macro economic scenario should be made more conducive to attract foreign investment on a continuous basis. It has called for speedy implementation of projects and removal of post-investment problems faced by investors. Steady improvement in GDP, lower levels of inflation, stable exchange rate and a well-regulated capital market would help to reduce the risk perception of investing in India, the chamber noted. It further added that the focus should be on efficient transport, communications and financial systems. The chamber feels that various laws relating to companies, foreign exchange, insurance and labour should be amended to facilitate a more conducive environment for foreign investment. UNI
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