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Finance Minister Arun Jaitley and his officials plan to visit America, Australia, Britain and some Asian countries to sell India as an investment destination.
These are planned from September, when the government is to start stake sales in public sector units and banks. With the markets performing better than ever, the Narendra Modi government will try to woo foreign investors to invest in India’s growth.
Officials said India will tell investors that the fiscal deficit target of 4.1 per cent of gross domestic product, though difficult, would be achieved. And, that the country would go back to a high growth trajectory, while keeping inflation under control. The finance minister might assure investors that bottlenecks in projects will be removed.
Jaitley is not likely to visit all the countries himself. Some places such as Singapore, Hong Kong and Japan might be covered by his senior officials. The shows are likely to be organised in the US when he goes to Washington for the annual meetings of the International Monetary Fund (IMF) and the World Bank on October 10-12. Road shows might be organised in Chicago and New York. Likewise, those in Australia will be clubbed with the G20 finance ministers' meeting in Brisbane on November 13-15.
“The minister has said he doesn't want to stay away from the country for more than three to four days at a stretch. So, other countries will be visited by senior official en route their visits for G20 or Fund/Bank meetings or some other work,” said an official who did not wish to be identified.
There will be a Financial Stability Board meeting in London in September. So, there will be some meetings with investors too. It has not been decided whether the finance minister will do the shows in London or officials. A final decision on all these will be taken after the ongoing session of Parliament.
The government disinvestment programme will begin with a five per cent stake sale in Steel Authority of India by October. This will be followed by a 10 per cent stake sale in Coal India. Other issues being readied are in Power Finance Corporation, Rural Electrification Corporation, Tehri Hydro Development Corporation, SJVN, NHPC, Container Corporation, MMTC, Neyveli Lignite and MOIL.
Stake dilution in public sector banks will start from November. The country’s largest lender, State Bank of India, is also expected to tap the markets to meet its capital requirements.
In the past, former finance minister P Chidambaram had also visited various countries to attract foreign investment. However, the efforts did not yield much result, as those markets were not doing well and the Indian economy was under stress, with annual growth slipping to below five in both 2012-13 and 2013-14. This year, the government expects the economy to grow in the range of 5.4-5.9 per cent. Hopes of higher growth are primarily pinned on the second half of 2014-15.
India got $17 billion of foreign portfolio money till August 5 of the current financial year, against a net outflow of $3.5 bn last financial year. The country also drew $3.9 bn of foreign direct investment in the first two months of 2014-15, a 34 per cent higher sum than what was attracted in the corresponding period of the previous year.
