India world's 21st largest outward investor: Report

INDIA-FDI

Lalit K Jha
Washington, Sep 23 (PTI) India has emerged as the world's
21st largest outward investor, with the Indian investing over
USD 75 billion overseas in the past decade, a Columbia
University report has said.
"India is now the world's 21st largest outward investor,
which is significant given its historically minuscule foreign
direct investment (FDI) outflows," said the Vale Columbia
Center on Sustainable International Investment in its report
released on Outward FDI from India.
"Annual FDI outflows have jumped fifty-fold after 2000,
and Indian firms have invested over USD 75 billion overseas in
the past decade, in some cases to attain global status by
acquiring world-leading firms," the report said.
Substantial improvements in the country’s economic
performance and the competitiveness of its firms and their
strategy, resulting from ongoing liberalisation in economic
and outward FDI (OFDI) policies, made these developments
possible, it said.
Indian firms now invest across a wide variety of sectors
and countries, departing from their historical focus on
trading and textile investments in developing countries.
Following the 25 per cent crisis-induced drop in Indian
OFDI in 2009, Indian firms are once again increasing their
overseas investment, including through mergers and
acquisitions (M&As), the report said.
"India’s OFDI should continue its rapid upward trend over
the next few years, as more companies seek to transfer their
products and service innovations to new markets, and acquire
strategic international know-how and market shares,
particularly in crisis-hit developed economies," it said.
Another report by the Columbia university released
Wednesday said that India is now the world's 13th largest FDI
host country.
With 2008 inflows of USD 42 billion and 2009 inflows of
USD 27 billion, it is also among the top three preferred
investment destinations globally.
"Notable liberalisations in FDI policy and in several
economic sectors, a globally competitive workforce, and rapid
GDP and market growth are the main drivers of foreign
investment in India.
"Yet, equity caps limit the size of potential new
inflows, while national security concerns might prompt more
oversight of FDI approval processes," it said.
India had received some USD 169 billion of cumulative FDI
inflows by the end of 2009 since it first opened itself to
foreign direct investors in 1991, it said. "Inflows rocketed
to USD 20 billion in 2006, further doubling to USD 42 billion
in 2008, transforming India into the world's 13th largest host
to FDI globally," it said. PTI LKJ
SAK



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