Many institutions like temples were flush with money which they were investing in land and gold but were reluctant to invest in industry and manufacturing, said Mr. Natchiappan.
Ours is a democratic country and we have to respond to the fears expressed by the public regarding money from abroad. FDI inflow has to be monitored by the Government Dr. Natchiappan pointed out. At the same time he recalled that 100 percent FDI had already been allowed freely in several fields like pharmaceuticals, education and infrastructure. He was confident that henceforth more FDI would come in agriculture also to meet the demand-supply gap.
While their fear of share market volatility was understandable and the money could also be invested in areas like manufacture for the benefit of the nation, he opined.
Dr. Natchiappan expressed happiness at the rise in Overseas Development funding by Indian enterprise but pointed out the areas for investment in Africa and South and South-east Asia countries where the long term opportunities were more.
The current attraction for Indian capital in Europe could have a flip side as there would be more restrictions as the European economies recover, he cautioned.
While replying to a question on Government view on imposing reservation in private sector for weaker sections, the Minister said, many of the private sector establishments are already ensuring that opportunities are given to qualified people from the weaker sections of society. What the Government was asking for is not reservations for non-qualified people from the weaker sections but equal opportunity for the qualified from the weaker sections also.
According to the Minister the sharp surge in FDI flow into India during the first quarter of this fiscal year at $5.9 billion which was double the amount in the same quarter last year is a reflection of the growing confidence of the global investor's in the country's long-term growth story. He characterized as achievable the Government's aim of $30 billion in FDI inflow this fiscal year.
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Ms Rita Singh, CMD, MESCO Steel Limited said, overseas direct investment (ODI) concerns Indian businesses as much as FDI, for the simple reasons that ODI is central to Indian companies while FDI is driven by foreign companies.
She further said, there is a need for simplifying provisions for investment overseas. Though much liberalized FEMA has come into force, but the mindset of authorities concerned has not changed with the law.
Mr S.C. Aggarwal, CMD, SMC Group said, the government should design the FDI policy in such a way where FDI inflows can be utilized as means of enhancing domestic production, saving and export through the equitable distribution among states so that they can attract FDI inflows at their own level. FDI can also help to raise the output, production and export at the sectoral level of the Indian economy. It is advisable to open up the export oriented sectors and higher growth of economy could be achieved through the growth of these sectors.
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