• About Us
      Asia’s 1 st LEED Platinum Rated Campus

      Asia’s 1st LEED Platinum Rated Campus

      About Us

      • Chairman's Message
      • Vice Chairman & CEO
      • Dean's Message
      • Governing Council
      • Business Advisory Council
      • Academic Advisory Council
      • Work With Us
      • Mandatory Disclosure
      • Anti-Ragging Notice

      TERM ZERO

      Media

      • News
      • Events
      • In Media
      • Media Kit

      Rankings

      Accreditations

      NIRF

      Campus

      Blog

      Annual Events

      • Convocation
      • TEDxGLIMChennai
      • L'Attitude
      • Digital Symposium
      • Sangamitra
      • Annual Alumni Meet
      • SWIM
      • IEC
      • Human Capital Management
  • Programs
      Transform and Lead

      Transform and Lead

      Full Time Programs

      PGPM

      One Year MBA for professionals with work experience

      Learn More Apply Now

      PGDM

      Two Year MBA for professionals with 0-2 years of work experience

      Learn More Apply Now

      EXECUTIVE EDUCATION

      Partner with us for customized learning solutions for your organisation

      Learn More

      Corporate Programs

      PGXPM

      Executive program for Mid & Senior Level working professionals

      Learn More Apply Now APP. Deadline: 30th August, 2020

      PGPM Flex

      Weekend management program for young working professionals

      Learn More Apply Now APP. Deadline: 30th August, 2020

      MBA in Business Analytics

      Family Enterprises Management

  • Faculty & Research
      Ranked 6th

      Ranked 6 th

      by NIRF ranking in teaching and learning among all B-Schools in the country

      Faculty

      • Full Time Faculty
      • Visiting Faculty
      • Adjunct Faculty

      Research

      • Faculty Editors
      • Papers & Journal Publications
      • Case Studies & Books
      • Conference Proceedings

      Centers of Excellence

      • Centre For Excellence in Retail Management
      • Great Lakes Centre For Management Research
      • Kotler - Srinivasan Centre for Research in Marketing
      • Centre for Excellence in Business Analytics and Business Intelligence
      • CET
      • Union Bank Centre for Banking Excellence

      Conferences

      • NASMEI
      • Financial Conference
  • Recruiters & Companies

      “Great Location for Talent. We are happy to continue visiting and having budding professionals join us and grow their careers.”

      Anil Visal

      Partner - Deloitte India

      Campus Recruitment

      • Recruitment Process
      • PGDM Class Profile 2018-20
      • PGPM Class Profile 2019-20
      • Past Recuiters
      • Student Achievements
      • Recruiters Speak

      Internships

      • Recruitment Process
      • PGDM Class Profile 2019-21
      • Live Projects

      Placement Reports

      • PGPM
      • PGDM
      • Internship Report

      Leadership Series

      • Titans Speak
      • Industry Lecture Series
      • Thought Leader Series

      Talent Listings

  • Alumni

ATTRACTING FDI INTO INDIA: WHAT NEEDS TO BE DONE? – BY Dr. BOBBY SRINIVASAN AND Dr. SUDHAKAR BALACHANDRAN

November 17, 2014 | Posted by bobbysrinivasan << back to blog

The Indian foreign reserve stands at $315 billion, an amount equal to 7 to 8 months of imports approximately. When we look at the components of reserves, the main contributor are foreign institutional investors (FIIs), non-resident Indian (NRI deposits), external commercial borrowing of public and private sectors (ECB), net royal payments and to some extent foreign direct investments (FDIs). Our merchandise trade is always in deficit eating away the foreign reserve. Also, the foreign direct investment (FDI), more or less is slow coming. If something happens to global stock market, FIIs will flee, which could reduce our reserves significantly. One of our main strength, of course, is the software sector, which has brought in so much of foreign exchange over time.
Is the existing model of acquiring and building foreign exchange reserves the right one for the future needs of India and to stabilize the value of rupee is the moot question which is addressed here.
Foreign direct investment is a must for India. This is a much neglected area as of now and so lots of efforts are needed. Let us look at our current performance:
1. Nokia, a mobile manufacturing unit near Chennai, was one time one of the largest facilities world-wide was closed sine die after they sunk nearly US $ 300 million of investment. Reason offered for closing is unresolved tax dispute. A disputed amount of 3000 crore which subsequently rose to 21000 crore.
2. In July 2013, South Korean steel manufacturing company Posco decided to scrap the steel plant which was to have been located in Karnataka.
Reasons offered: The 6 million capacity steel plant was scrapped due to market condition and significant delays in acquiring land.
3. Arcelor Mittal and the Vedanta group decided not to set up their manufacturing plants in India.
Reason cited: Red tape and land acquisition delays.
4. In the mutual fund industry, which allows 100% FDI, Fidelity, Merrill Lynch, AIG, Temasek, Standard Chartered Bank all exited the Indian market without offering specific reasons.
It is already well known that India is not necessarily the best destination for FDI because of many constraints and restrictions. Laws relating to land acquisition and labour employment regulations are real challenges to foreign companies locating facilities in India. Finally, we can learn a lot from China, which is the front runner in attracting FDI. It is time our government show greater commitment and sell india as a good place to invest. After all, foreign companies want good rates of return from their investment which will include a premium for country risk.
We need a study to evaluate what the foreign companies expect to gain from locating their business in India and what are the possible constraints. Half the battle will be won if these constraints are immediately removed. Every year nearly 10 million job seekers arrive to the market. FDI, to a great extent, can help in creating jobs for these young men and women.

<< back to blog

Programs

PGPM - One Year MBA for professionals with 2+ years work experience

Learn More >

PGDM - Two Year MBA for graduates with 0-2 years work experience

Learn More >

Events

Union Bank Finance Conference
Dec 17, 2020

Networking with Champions
Nov 08, 2020

Harry Kraemer on Performance with A Purpose
Oct 08, 2020
Read more

Successful Women in Management (SWIM) Lecture Series
July 05, 2020
Read more

The Great Circle Alumni Talk Series
July 04, 2020
Read more

  • About Us
  • Programs
  • Faculty & Research
  • Recruiters & Companies
  • Alumni
  • Blog
  • Contact Us