India prefers FDI to boost growth rate 8%: Arvind Mayaram
24/06/2014 16:48
With growth trending below 5 per cent for two successive years, Finance Secretary Arvind Mayaram said India would prefer the FDI route over FII inflows if overseas resources need to be generated to spur economic expansion to its potential level. "I believe our potential growth rate is 8 per cent. And to get there, we need to develop resources. And that which we cannot generate domestically must come from outside and if it comes from outside then we prefer it in the form of foreign direct investment (FDI) rather than foreign institutional investment (FII)," Mayaram said. India's gross domestic product (GDP) expanded 4.5 per cent in 2012-13, the slowest pace in the past decade, and at 4.7 per cent in 2013-14. The Reserve Bank of India this month retained its GDP growth estimate of 5 to 6 per cent in 2014-15. To further attract foreign inflows, the government plans to relax the FDI policy in sectors such as defence, railways and construction activities. Mayaram emphasised the need to bring India back on the growth path to attract investments. "You must remember that investments don't come because of agreements like Bilateral Investment Promotion and Protection Agreements. Investments come if there are opportunities to make profits. Opportunity to make profits can only happen when growth is higher and when the economy becomes robust," he said.
24/06/2014 16:48
With growth trending below 5 per cent for two successive years, Finance Secretary Arvind Mayaram said India would prefer the FDI route over FII inflows if overseas resources need to be generated to spur economic expansion to its potential level. "I believe our potential growth rate is 8 per cent. And to get there, we need to develop resources. And that which we cannot generate domestically must come from outside and if it comes from outside then we prefer it in the form of foreign direct investment (FDI) rather than foreign institutional investment (FII)," Mayaram said. India's gross domestic product (GDP) expanded 4.5 per cent in 2012-13, the slowest pace in the past decade, and at 4.7 per cent in 2013-14. The Reserve Bank of India this month retained its GDP growth estimate of 5 to 6 per cent in 2014-15. To further attract foreign inflows, the government plans to relax the FDI policy in sectors such as defence, railways and construction activities. Mayaram emphasised the need to bring India back on the growth path to attract investments. "You must remember that investments don't come because of agreements like Bilateral Investment Promotion and Protection Agreements. Investments come if there are opportunities to make profits. Opportunity to make profits can only happen when growth is higher and when the economy becomes robust," he said.
